Tamarind prices have almost trebled in the last 22 months on a combination of factors such as lower area under the tree-crop, lack of growth in production, export demand and rising consumption.

The price surge has been more prominent in the last couple of months with processed tamarind (without seeds) quoting Rs 180 a kg at retail outlets.

Lower crop

“The crop has been lower in the last two years. As a result, carryover stocks in warehouses have dropped alarmingly,” said Mr S.N. Veerasamy, a wholesale trader in Chennai.

According to Spices Board data, tamarind increased from Rs 27.50 a kg in December 2009 in wholesale markets to Rs 76.67 in August this year.

Data also show that between 2004-05 and 2008-09, area under tamarind has dropped 13 per cent to 55,682 hectares.

At the same time, production has hovered between 1.94 lakh tonnes in 2004-05 and 1.93 lakh tonnes in 2008-09.

However, during the time in between these two fiscals, the production had dropped marginally.

But the yield has increased to 3.51 tonnes from 3.15 during the review period.

Higher exports

Exports, on the other hand, increased to 17,500 tonnes during 2010-11 valued at Rs 80 crore from 14,010 (worth Rs 30.78 crore) in 2005-06. In between, it had dropped to as low as 11,250 tonnes (Rs 31 crore) in 2007-08.

“Actually, tamarind prices are coming off a high seen at the end of September when prices at wholesale levels rose to Rs 9,500-11,000 a quintal,” said Mr C. Raja, a tamarind dealer in Madurai.

“Prices could drop further after Diwali as the new crop is due in December. In November itself, prices can drop anticipating higher crop,” he said.

But Mr Veerasamy said next year's crop was also expected to be lower as the trees had been affected by indifferent weather pattern.

According to the Agriculture Ministry, the modal price or the rate at which most trades took place in tamarind (with seeds) is currently Rs 3,400 a quintal at Hindupur market in Andhra Pradesh against Rs 1,500 during the same time a year ago.

The fine variety is ruling at Rs 7,900 a quintal (Rs 5,400).

In Bangalore, the modal price for tamarind is currently Rs 10,000 a quintal against Rs 4,800 a year ago.

Tamarind is grown in Tamil Nadu, Karnataka, Andhra Pradesh and Kerala. Karnataka is the leading producer of the spice followed by Tamil Nadu.

“Prices had gone up as there was export demand from the Gulf, Pakistan, Bangladesh and Malaysia,” said Mr Raja. “Crop failure in Indonesia, Burma and Thailand helped in Indian tamarind gaining,” he said.

“But we think prices won't sustain at current levels. Traders could lower them fearing new crop arrivals. Tamarind prices don't rule at higher level continuously,” Mr Raja said.

Supply shortage

“This year, farmers are the sole gainers from higher prices for tamarind. They were quite aware of the supply shortage,” said Mr Veerasamy. “They quoted the inferior variety at Rs 95 a kg, while the best was quoted at Rs 130 a kg,” he said.

Prices upped further at retail outlets as trader's margin has to be met, while charges for cold storages also have to be met.

Traders foot Rs 10,000 to keep 10 tonnes of tamarind in cold storages for six months.

“Besides warehouse charges, labour charges, transport costs are rising,” said Mr Veerasamy.

“We will have to learn to live with higher prices for tamarind. Chances of prices dropping sharply are remote,” said Mr Veerasamy.

Reasons for prices that are seen firm even in the long trend are the decreased number of tamarind trees. “We are losing trees to realty and urbanisation,” said Mr Veerasamy.

Besides, lack of quality produce is pushing up prices. According to retailers, low-priced tamarind turns watery and does not have a longer shelf life.

“These are called local or line varieties. They don't have much juice and most of the pulp gets wasted,” said Mr Veerasamy.

Related Topics
comment COMMENT NOW