Commodities

Covid-19: The fear is palpable; impact varies

Our Bureau Bengaluru | Updated on March 16, 2020 Published on March 16, 2020

A view of the APMC market yard in Ye shwanthpur on Monday. Trading activity was dull as both buyers and sellers have largely stayed away because of the coronavirus scare. GRN Somashekar   -  BL

The coronavirus scare has slowed down commodity trading in several markets, mainly in Madhya Pradesh, Karnataka and Kerala, while operations were largely unaffected in Telangana, Gujarat and Maharashtra among other States.

Cardamom auctions in Puttady in Idukki and Bodinayakanur in Tamil Nadu have been indefinitely suspended due to the prevailing virus scare. The auctioneers told BusinessLine that they have received a directive from the Spices Board officials at Bodinayakanur to cancel the auctions and further decision in this regard would be issued soon.

Cardamom traders are keeping their fingers crossed over the decision to cancel the auctions. Traders said sellers would lose an avenue to liquidate their stock in the auctions, which is a recognised platform for price discovery and more than 80 per cent in the primary market are depending on this particular mechanism. The decision has come at an inappropriate time when the market was on a positive note and gearing to cater to the export demand in the Gulf countries ahead of Ramadhan festival, traders said.

Pulses trade disrupted

Similarly in Karnataka’s Kalaburgi, where tur/arhar is the major commodity traded, operations has been suspended for about week from Monday. This was after the first casualty in the country due to the coronavirus infection was reported from Kalaburgi last week. “There is a complete shutdown,” trade sources in Kalaburgi said. In a bid to contain the spread of virus, the Karnataka Government has placed restrictions on mass gathering in public spaces.

In the mandis of Indore, the virus scare has impacted trading both in edible oils and pulses, leading to decline in demand and prices. The arrivals have also declined as compared to the past. Sanjay Agrawal, a trader in Indore said due to the scare over the spread of virus, both buyers and traders are staying away from the market.

In the Yeshwantpur market yard of Bengaluru, the main transit hub for commodities such as onions and potatoes to the southern cities, trading was muted as market participants largely stayed away due to the corona virus scare and the government restrictions on public gatherings. Balasaheb Bhende, former director of APMC, Navi Mumbai, said the virus scare has reduced footfalls in the market since Saturday. Buyers are shying away from the market and prices of fruits have declined by about 10-15 per cent, he said.

However, Lalit Shah, Chairman of Latur APMC said that as on Monday, there was no impact of coronavirus scare on the market operations. However, the Maharashtra government has asked all the APMCs to take precautions so that crowding is avoided in the market. The APMC Latur has called a meeting of all stakeholders including traders, farmers and loaders to discuss the issue.

Precautionary measures

“Closing of the market operations is not feasible as farmers have no other avenue to sell their goods. But on the other hand, for the process of price discovery, about 150 buyers and traders converge in the market, which is also not a good idea given the pandemic. Therefore, as a middle path, samples of farm goods could be procured and the deal could happen at the shops of the traders, which will see fewer people placing bids. This kind of market operations is still at idea level,” Shah said.

In Telangana, trade was unaffected by the virus scare. Warangal, one of the biggest hubs for cotton and chillies in the South, continues to get the average arrivals. “On Monday, we received 50,000 bags of chillies. Cotton too is arriving normally. As the season coming to an end, we are receiving about 2,000-3,000 bags a day,” an official said. “We expect chilli arrivals to go up. They can't keep it with them. They have to offload the produce.”

Essential commodities such as onion too is showing no sign of reduction. Mahbub Mansion Market Yard at Malakpet, a key market for Hyderabad and Ranga Reddy districts, sees no impact of arrivals of onion. “Arrivals are down but it is natural for the month of March,” a Mahbub Mansion Marketing Committee official said.

Similarly, trading at none of the Gujarat APMCs has been impacted by coronavirus. “There is no impact on trading activity as such. The APMC is operating normally with good arrivals of all important commodities. At present we are not in a panic mode,” said Atul Kamani, President of Commission Agents Association at Rajkot APMC.

With Inputs from V Sajeev Kumar in Kochi, Rahul Wadke in Mumbai, KV Kurmanath in Hyderabad, Rutam Vora in Ahmedabad and our correspondent in Indore

Published on March 16, 2020
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