Turmeric prices have gained about ₹2,000 a quintal since Diwali on good domestic and export demand, besides fears of heavy rains having affected the new crop due next month.

“We saw a good demand after Diwali for turmeric. We thought it was small and could be temporary, but the uptrend has continued,” said RKV Ravishankar, President, Erode Turmeric Merchants Association.

Initial gains

Currently, the modal price or rate at which most trades take place for finger turmeric is ₹7,754 a quintal in Tamil Nadu’s Erode market against ₹6,607 on November 9, when the markets opened after Diwali. In Nanded, Maharashtra, the spice modal price is ₹8,000 and in Nizamabad, Telangana, it is ₹7,885.

On the National Commodities and Derivatives Exchange, turmeric for delivery in April was quoted at ₹9,228 a quintal on Wednesday, while spot price for farmer polished turmeric was ₹8,445.

“Turmeric prices initially gained on rumours that the crop has been affected due to heavy rains in growing areas,” Ravishankar said.

“The sentiment improved on reports of damage to the crop in Telangana and Andhra Pradesh. It has helped prices to rise by at least ₹1,000,” said Poonam Chand Gupta, a trader from Nizamabad.


Lower output

“The market sentiment is buoyant mainly since the ending stocks are expected to be 17-18 lakh bags (50 kg each) this year against 25 lakh bags last year. There has been good demand in the domestic and export market,” said Sunil Patil, a turmeric supplier from Nashik in Maharashtra.

This year, the crop was also lower compared with last year, he said. Also, the quality of the produce was not good, resulting in prices gaining.

Also read: AgNext ties up with Spices Board to test curcumin content for Lakadong turmeric

Spices Board data showed turmeric production this year being projected at 11.01 lakh tonnes against 11.78 lakh tonnes last year, mainly on the output being affected in Telangana, Karnataka, Tamil Nadu, Assam and Haryana.

New arrivals delayed

In view of the heavy rains in the growing areas, particularly Maharashtra, the next crop’s yield could be lower, Patil said.

The new turmeric crop is expected to hit the market by the middle of next month but due to the rains in October and November, it could be delayed by two to three weeks, Patil said.

Ravishankar said the new crop was due sometime later next month. “Since export demand is also strong, there is a bullish mood,” he said.

Concurring with Patil and Ravishankar’s view, Gupta said exports had slowed now due to Christmas but they will resume with vigour next month. “We had export demand from all quarters, particularly Bangladesh and Gulf countries,” he said.

H1 exports down 26%

However, Spices Board data show turmeric exports lower by 26 per cent in volume during the first half of the current fiscal at 77,245 tonnes valued at ₹860.31 crore against 1.04 lakh tonnes valued at ₹903.31 crore during the same period a year ago.

Patil said prices had dropped before Diwali as many farmers looked for liquidity, particularly wanting to shift from turmeric to soyabean, whose prices were ruling at a record high of over ₹8,000 a quintal.

Also read: Soyabean plunges on NCDEX as SEBI bans futures and options trade

“It led to higher arrivals then and resulted in a drop in prices,” he said, adding that since then prices have improved remarkably.

In addition, the trader is now concerned over reports of a disease outbreak in the turmeric crop in Karnataka. “The production could be lower by about 25 per cent in Karnataka due to this disease, primarily since it will affect the yield,” the Nashik supplier said.

Going forward, turmeric prices could rule high gaining ₹1,000-1,500 over the next two months, Patil said. The trend on NCDEX for April futures also indicates firming up of the price.

“We might see things cooling down during April-May,” he said.

Kedia Advisory said turmeric futures, initially, had support at ₹9,256, while they could meet resistance at ₹9,378.