Weekly: Spot Turmeric Declines On Good Crop Prospect

MUMBAI (Commoditiescontrol) - Turmeric prices during the week ended Wednesday (September 13-20) dropped more than 1.5% due to subdued activity in the spot market and weak cues from futures. Prices were also pressured due to better crop prospects after recent rainfall.

Turmeric growing regions earlier this month received good rainfall, which has raised Turmeric crop outlook, which was prone to get damaged due to porlonged dry spell.

The rainfall has turned boon for the crop and showers lashed on right times, other wise significant losses to crop was very much card, according to traders.

Market participants were slightly bullish in the commodity earlier last month due to expectations of lower production due to dry weather conditions, but good rainfall has prompted them to wait and watch.

Demand in Turmeric is very thin during the last couple of months and still not recovered as was anticipated despite of ongoing festival season, said a trader from Nizamabad.

"We were expecting demand to recover, but bulk buying from upcountry buyers were affected since demonetization, and then due to implementation of new tax regime GST."

There is not enough liquidity in the market, which has also hurted the overall trade, he noted.

Though domestic demand was not very encouraging during the last few months, but export inquiries were consistent providing good underlying support to the Turmeric price, he added.

The stocks of Turmeric is declining and is very thin at present compared to last year, which is positive for market sentiments, but slow domestic demand and stocks of around 48,500 tonnes with APmarkfed likely to test nerve of market on the upside, he added.

Turmeric October delivery futures dropped 3.29% during the week (September 13-20) due to increased selling pressure weighed by weak cues from the spot market.

Open interest and volume in October contract declined gradually with detrimental in prices indicating subdued tone to continue.

(By Commoditiescontrol Bureau; +91-22-40015533)