Commodities

Guatemala spices up Indian cardamom

GK Nair Kochi | Updated on January 28, 2014 Published on January 28, 2014

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Poor quality of produce from the competitor leads to good enquiries for exports, but shortage of 7 mm grade hurts

Cardamom prices gained some flavour on good export enquiries and lower supplies at auctions held last week.

Cardamom growers and the trade had some thing to cheer at the beginning of the New Year. Kerala Finance Minister KM Mani, in the State Budget for 2014-15, responding to the demand from all stakeholders in the sector especially the Spices Board, reduced the tax on cardamom at the point of sale of auction through authorised auction centres of the Spices Board to 2 per cent.

It has been well received by the growers and traders. Overall, arrivals declined last week. The trade attributed it to suspension of auctions last week for two days on account of Republic Day.

Export buying

On the other hand, the crop entering the last round of picking (the 6thround) is also a reason for auctions going slow. The picking will last till February-end.

Exporters have good demand on hand because of attractive price levels and poor quality of material from Guatemala, world’s biggest producer, market sources told Business Line.

But non-availability of the required grade of cardamom of 7 mm and above has turned out to be a problem, they said. Upcountry buyers are buying but it is limited, trade sources in Bodinayakannur said.

According to them, as prices are ruling low many stockists have bought cardamom. Whether these stocks have been sold or not is unknown.

However, the cold weather prevailing in north Indian States has brought retail sales to a standstill.

At the same time, if stockists have depleted their inventories, then demand is expected to pick up in the coming weeks.

Exporters have bought an estimated 50 tonnes of cardamom. “They would have bought more but for the non-availability of the required variety”, sources said.

Weather factor

As the weather in the growing areas has become dry and hot, harvesting in small and non-irrigated estates has almost come to an end. Harvesting might last for some more weeks only in those estates which have irrigation facility.

The growing areas have not received any rains in January. Normally, the growing areas get good showers once in a month and if that happens this and next month, there could be an early crop next season, they said.

Individual auction average improved last week to touch ₹590 a kg. During the current season of the crop, which officially began on August 1, arrivals have totalled 12,977 tonnes against 7,286 tonnes during the same period a year ago. Sales were at 12,661 tonnes against 6,934 tonnes respectively.

Auctions

Going by the arrivals and sales this season, cardamom production this season could be at least 70 per cent more than what it was last season, traders said. The individual auction average this season has dropped significantly, as a result. The weighted average price as on January 25 was ₹592.73 a kg against ₹772.92 during the same period a year ago.

Arrivals at all auctions last week declined and that reflected on the price trend, PC Punnoose, General Manager, KCPMC, told Business Line. Prices of all graded varieties moved up on good export demand last week and their prices (in ₹/kg) were: AGEB 725-730; AGB 605-615; AGS 570-580; and AGS-1: 540 - 555.

Dry weather conditions prevailed in the growing areas with fall in temperature during nights in Kerala's Idukki district last week.

Published on January 28, 2014
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