Weekly: Weak Trend In Spices Complex For Second Consecutive Week This Month

MUMBAI (Commoditiescontrol) - Weak Trend continued to persist in spices complex for second consecutive week this month, Black Pepper was top loser commodity due to continuous import and ample availability of imported produce in major spot market places.

Rates in Rs/100kg:

BLACK PEPPER: Continuous imports of pepper from Sri Lanka and Vietnam allegedly smuggled into the country through borders with Bangladesh, Myanmar, Nepal have hammered down the Indian pepper prices by Rs.3,100 a quintal in a fortnight on Friday, claimed market sources.

Black Pepper prices declined further by 2% during the week ended on Friday.

They said the prices which were ruling at Rs.43,600 (Garbled) and Rs.41,600 (ungarbled) a quintal on February 1 fallen on Friday (today) to Rs.40,500 (garbled) and Rs.38,500 (ungarbled) a quintal.

Traders alleged that imports are taking place at much lower prices i.e., much blow the MIP of Rs.500 a kg but by paying the import duty at 8 per cent at the MIP rate.

Further, earlier this week the growers in the high ranges were reportedly not ready to sell their pepper at the current rates.

As the markets across the north Indian states are reportedly holding huge stocks of pepper of other origins smuggled into the wholesale/ retail markets, domestic demand was not forthcoming, they said.

This phenomenon has also aided the price fall, they said. Meanwhile, in the world market the Malabar pepper remained totally out priced.

Such a trend if continued to persist the Indian farmers would land in serious trouble, said a veteran trader.

Other hand, The harvest of pepper in Vietnam has begun though the market supplies are expected to remain slow moving in view of approaching TET Festival celebration next week.

Indian Pepper was traded this week was recorded tad up at 1,77 tonnes as compared with 1,62 tonnes last week.

CORIANDER:
Spot Coriander prices eased by 0.50% at benchmark Kota market of Rajasthan during the week ended on Friday amid thin business activities.

Domestic and export demand at present is sluggish as the buyers have turned sidelined and only buying as per their urgent requirements, said trade sources.

Some correction in the prices can’t be ruled out as the arrivals of new crop will increase gradually from now and arrival will come in large quantities will start from March till April, they added.

Other hand, the influence of overseas markets such as Syria and Turkey will only be felt post June, when the domestic arrivals will start drying.

As per trade estimates, Coriander imports this year is expected to decline this year as the prevailing prices are more or less same as compared to prices in rival countries.

Production of Coriander this year is pegged at 80 lakh bags (40kg each) due to lower sowing though the yield is expected to remain same as last year or decline upto maximum 10%.

As per market sources, Outlook for Coriander is positive as the prices will gain after peak arrival season due to lower production this year.

Coriander export is likely to rise this year as the prices have turned attractive for international buyers.

Coriander futures April month prices declined by Rs.96 or 1.72% at Rs.5,492/100kg during the week on the National Commodity and Derivative Exchange Limited.

Open interest of same contract was recorded higher on Friday at 23,250 lots versus 23,120 lots on Monday.

Coriander new crop stock at the NCDEX accredited warehouses in Gondal on February 04 was recorded at 7, 691 mt (Unencumbered i.e free of debt ), as per exchange data.

JEERA:
Spot Jeera prices declined by 0.87% at Rs.19,100/100kg at benchmark Unjha market during the week ended on Friday amid weak demand from domestic and overseas buyers.

Jeera supplies seen increasing during the week at Unjha, Rajkot and Gondal market of Gujarat which also weighed on prices this week, said market sources.

Further, due to climatic fluctuations coupled with isolated instances of disease has become a cause of concern for the jeera farmers in Gujarat.

According to farmer sources in Saurashtra, a disease ‘alternaria blight’ has surfaced in select pockets of Rajkot and Jamnagar districts.

Although, as per market sources, there is no remarkable impact of the climatic extremities on jeera crop. The crop will be better than last year, hence there is not likely to be any sharp rally in prices in short-term.

Other hand, Traders see India's jeera output rising to around 65-70 lakh bags (55 kg each) in 2018-19, mainly driven by the rise in acreage in Gujarat and Rajasthan, the top producers of Jeera.

The official sowing data for Rajasthan, the second largest producer is not available.

Jeera exports are set to rise in 2017-18 (Apr-Mar) due to the ongoing political unrest in Syria and decline in stocks in Turkey.

Jeera exports during Apr-Nov 2017 was recorded higher by 14.74% at 95,928 metric tonnes versus 83,607 metric during same period last year.

Until the new crop arrives at rival countries in June, India will be the sole supplier of the spice in the global market.

European countries, Singapore and China are buying jeera from India at $2,900-$3,000 per tn.

The 67% rise in prices last year encouraged farmers to sow more of the spice hence this year the spice is set to lose flavour as supplies are set to rise with output seen up 30%.
Jeera future contract March month expiry during the week plunged by Rs.245 or 1.52% closing at Rs.16,420/100kg on the National Commodity and Derivative Exchange Limited.

Jeera new stock at the NCDEX warehouses as on February 15 was stood at 2,84 mt (Unencumbered) and 3,94 mt (Pledged) in Jodhpur while 3,428 mt (Unencumbered i.e free of debt) and 4,793 (Pledged i.e given as security on a loan) in Unjha, as per exchange data.

TURMERIC:

Spot Turmeric prices more or less steady at benchmark Nizamabad market as the market remained closed from Monday till Thursday on account of Mahashivratri and Amavasya.

On Friday, the prices at Nizamabad eased by Rs.100/100kg due to sluggish domestic and export demand against decent new crop arrivals, said market sources.

New crop arrival at Nizamabad was recorded at 20,000 bags (70kg each) and was traded at the prevailing prices.

In 2017-18, from January onwards, Turmeric prices reported down due to higher production than previous year. Turmeric lower prices recorded at Nizamabad mandi Nizamabad quality finger Rs.5700/-qtl during May month.

However, from June onwards prices took support and moving upside due to lower rainfall in major growing regions and expected lower sowing report. In the benchmark market, Turmeric prices during December month ended with at Rs.8068/-qtl.

As per market sources, the begging stock this year is pegged around 22 lakh bags (70kg each).

Other hand, Increased global demand for turmeric, especially in the pharmaceutical sector, drove its exports to 1,16,500 tonne in volume and Rs 1,241 crore in value terms in 2016-17. There are expectations of improved demand in coming weeks from the export market.

Turmeric prices are expected to trade sideways to downward amid sufficient stock availability in major markets followed by entry of new crop in small quantities and subdued domestic demand.

However, the fundamentals support a firm market on the basis of reports that the production in Tamil Nadu, Andhra Pradesh and Telengana would be lower than last season.

Turmeric futures contract prices delivery in April remained more or less same as the prices declined by Rs.8 closing at Rs.7,258/100kg on the National Commodity and Derivative Exchange Limited.

Open interest of same contract was recorded lower at 10,270 lots against 10,670 lots on Monday.

RED CHILLI:
Spot Red Chilli Teja variety prices tumbled by 1.01% at benchmark Guntur market of Andhra Pradesh on Friday due to poor buying support from international buyers, said market sources.

Prices of other varieties traded mixed during the week as the prices were quoted as per the quality of the stock and moisture content.

Further, The Horticulture & Food Processing Department of Madhya Pradesh expects Chilli production in 2017-18 (Jul-Jun) to fall 29% on year to 247,000 tn due to pest attack and fall in acreage. Chilli production in 2016-17 was 350,000 tn.

As per market sources, Chilli cold storage stocks in Guntur were reported higher due to higher production in 2017 – 18.

Acreage under chilli has fallen to 98,857 ha in 2017-18, down 19% from last year, Madhya Pradesh is the fourth largest producer of chilli.

The state's chilli output has been declining for the last three years due to incessant pest attacks.

The major chilli affected areas in the state are Khargone, Badhwani, Dhar, and Khandwa regions in the western and southern parts of the state.

Chilli outlook this year is positive due to lower production as farmers lost interest last year because of lower prices during sowing period.

Consumption of chilli is increasing substantially with the branded powder sales growing at a compound annual growth rate of 11% while the spices mix category is growing at a CAGR of 7%, according to a spices board report on the commodity.


(By Commoditiescontrol Bureau; +91-22-40015522)