Over-supply likely to impact prices at the cardamom auctions

Heavy arrivals in the last few days and the consequent over-supply in the market, are likely to have an impact on prices in the cardamom auctions on Thursday.

According to traders, more arrivals may affect the buying power of traders, as the procured cardamom requires cleaning and grading before it is dispatched to upcountry markets. This is a labour-intensive, time consuming process, which in turn, affects sales and payments from upcountry customers as well.

Meanwhile, total arrivals for the auction to be conducted at Spices Park in Puttady was 95 tonnes, which was lower than arrivals on the previous day. The auctioneers, the Cardamom Planters’ Association, has offered 30 tonnes for the morning transactions. The quantity on offer in the afternoon auctions conducted by the Cardamom Planters and Marketing Cooperative Society (CPMCS) was 65 tonnes.

Cardamom prices slipped on Wednesday despite heavy arrivals and participation of all categories of the trade cycle. However, traders were of the view that the bullish sentiment in prices is likely to continue till December, due to a smaller crop.

The analysts, Acumen Capital Markets Ltd, said the December futures price has shown some weakness on the daily chart. The most active cardamom fell by 4 per cent or Rs 116 to Rs 2,785 at close on Wednesday.