MUMBAI (Commoditiescontrol) - Spot cumin seed, red chilli and black pepper ended this on negative note, whereas coriander and turmeric edged higher supported by improved demand coupled with positive futures.
Cumin Seed
Cumin seed dropped more than 1 percent at Rs 18,687/100kg at the benchmark Unjha market due to slow domestic demand and weak cues from futures. Buyers were slightly hesitant as export demand in the last few weeks was sluggish due to volatility.
Gautam Patel, a trader from Unjha, said "Overseas buyers in the recent times opted to wait and watch due to volatility in prices. They are likely to enter market once prices stabilize," he added.
Fundamentals in cumin seed is positive as stocks from previous crop is poor due to lower production in 2016-17 (Mar-Feb), however production this year is better due to better yield.
India is likely to harvest over 58 lakh bags (55kg each) cumin seed during the current season (March-Feb) 2017-18 against 45 lakh bags last year as better yield offset acreage losses, according to Federation of Indian Spices & Stakeholders.
On futures cumin seed May futures ended this week with loss of 0.50 percent at Rs 19,005/100kg on profit booking at the higher level. Volume and open interest during the week decreased during the week indicating liquidation of long position.
For May contract Rs 19,745 will be key level and any further rise in prices likely only of breakout of this level.
Red Chilli
Spot chilli at the Guntur market dropped by 0.6 percent at Rs 5,325 this week on limited demand against decent supplies. Demand in the spot market at present matched supply. Stockists are buying red chilli at the lower level.
Chilli prices have crashed by 60 percent from a year earlier nearly 40 percent so far this year.
Higher red chilli production has led to its prices falling to the lowest in over a decade, prompting the Andhra Pradesh government to announce a price support scheme. High output and low prices may trigger higher exports this season.
As prices crash and with cold storages overflowing, the Andhra government has announced a price support scheme of Rs 15/kg for farmers, with effect from Thursday, April 20, 2017 till June-end. They will get it for a maximum of 20 quintals (2,000 kg).
“The price support scheme may not be of much use to growers as over 70% of them have already sold their produce,“ said Mitesh Jain, a red chilli trader from Byadgi.
High prices last year encouraged growers in Andhra, Telangana and Karnataka, the three main chilli growing regions, to go for increased sowing that resulted in a bumper crop.
Black Pepper
Easier trend continued in the spot pepper market during the week on increased supply mainly from Wayanad district of Kerala. Karnataka pepper is being sold in Pulpally and Bathery in Wayanad. The low bulk density Karnataka pepper is being sold at Rs540-550 a kg delivered in north Indian markets, trade sources said.
They said the north Indian dealers are waiting for the prices to drop to below Rs500 a kg which they anticipate to happen once the Vietnam pepper landed in the markets.
According to trade sources Coorg pepper was landing in the markets via Kerala's Wayanad district. Besides, rumors were being spread in the market that cheap Vietnam pepper would also be available soon.
It is claimed by the buyers that more and more imported pepper from Vietnam and increased supply from Karnataka would pull down the prices further. Add to this Sri Lankan pepper would also start arriving when harvesting begins there next month.
Bearish sentiment, as a result, is prevailing in the market at present pushing the prices down.
Meanwhile, the trade and the farmers are reported to have urged the Central government to fix a minimum import price of $6,000 a tonne for import of black pepper from Vietnam.
Indian parity in the international markets was at $9,500 a tonne cf for Europe and $9,750 a tonne cf for USA.
Coriander
Coriander was among the top gainer this week, registering more than 3 percent rise on good demand at the lower level from domestic buyers. Further there is growing optimism among traders that export might improve this fiscal year 2017-18 due to lower prices.
Coriander supply is good and farmers are interested to sell their produce after recent strength in prices.
India turned out net importer of coriander during FY 2015-16 as Russian produce was very competitive. India imported record 41.257.20 metric tonnes of coriander during April 16 to January 17 out of this 28,497.29 metric tonnes imported from Russia.
Coriander prices likely to trade steady around current level and sharp upside likely as it will make India coriander uncompetitive in the world market.
On derivatives, coriander May futures gained by 4.32 percent at 7,193/100kg this week on increased buying by market participants tracking good demand for coriander in the spot markets.
Turmeric
Spot turmeric rose 1.96 percent at Rs 5,975/100kg in Nizamabad, whereas May futures gained a tad at Rs 6,226/100kg. Some fresh buying at the lower level helped prices to recover after recent fall.
Turmeric farmers and traders have been hit hard by poor sales during peak season.
“Many traders and farmers expected good sales of turmeric during the peak period, which started a month ago,” said trader RKV Ravishankar.
“But, this year, for the first time in recent history, both farmers and traders are in agony due to poor production and tepid demand from North India.
Turmeric prices in the near term likely to trade steady with range-bound movement. Any major upside will be limited due to good arrivals of new crop and slow export demand.
(By Commoditiescontrol Bureau; +91-22-40015533)
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