MUMBAI (Commoditiescontrol) - Black pepper, Coriander traded higher at major spot markets due to improved domestic demand while Turmeric was the only loser this week in spices complex.
Rates Of Black Pepper In Rs/kg; Other In Rs/100kg:
BLACK PEPPER: prices rose most in the spices complex this week supported by good buying support from processors, said markets sources.
They were buying for delivering the spice to exporters who have made commitments earlier to supply pepper under MLSVB (Malabar, Lampond, Sri Lanka, Vietnam, Brazil) contract, they added.
Besides, owing to the upcholidays from Thursday onwards more buying activities were visible. Added to this is the prohibition on imports below the mimimum import price (MIP) of Rs.500 a kg.
Meanwhile, even as the pepper prices have been falling sharply the Vietnamese farmers are reportedly continued to expand the area under the crop to increase production.
The reason attributed to this trend is that pepper is proving to be more profitable than other crops, says an overseas report.
According to the report, "Combined global pepper plantations rose to nearly 519,000 hectares in 2015 from 443,000 hectares in 2010, which has resulted in an oversupply".
Between 2012 and 2017, it said, " the world’s pepper production surged by 5.5 percent, but demand rose only 2.4 percent".
Upsurge in global supply has led to declining prices, "and Vietnamese farmers are paying the price for their overproduction.
Yet, they say it is more profitable than other crops".
In the terminal market pepper traded during the week was recorded lower at 79 tonnes as compared with 108 tonnes last week.
CORIANDER: Coriander prices were recorded tad up by 0.60% at Rs.5,344/100kg at benchmark Kota market during the week ended on Friday amid thin business activities as the market remained closed after Wednesday on account of Mahavir Jayanti and Good Friday, claimed market sources.
Other hand, major market participants remained on the sideline as they were busy with closing their account statement for financial year-end.
According to recently concluded seminar (Feb 23-24) organised by Federation of Indian Spice & Stakeholders (FISS) the estimated area under Coriander during this year 2017-18 pegged at 2.76 lakh hectares (includes Rajasthan, Madhya Pradesh and Gujarat).
These 3 states cover nearly 80% of total area in the country (as per 2016-17 sowing data), which means if we add remaining 20% in 2.76 lakh tonnes than the estimates total area could be around 3.31 lakh tonnes for 2017-18. Acreage under coriander during 2016-17 was estimated at 6.62 lakh hectares, according to Indian Spices Board.
The agriculture department on time to time release coriander advance estimate, but the industry don’t rely on them as they believe that government production data is overstated and thus they mostly rely on data produced by well-known people in the industry, however there is doubt over authenticity about the such data.
Coriander prices during the last couple of years were under great pressure due to decent production, higher imports and decreased market share in the international market.
Although this might not be the case this marketing year MY 2018-19 (Feb-Jan) due to estimate of sharp drop in production and prospects of some better export amid lower price.
India’s coriander production this season MY 2018-19 is expected to drop 44.57% at 2.4 lakh tonnes year-on-year due to decreased sowing as farmers have shifted to other remunerative crops like Chana, Cumin, Garlic, etc.
On the National Commodity and Derivative Exchange Limited (NCDEX), Coriander futures contract for delivery in April moved up by Rs.21 at Rs.5,028/100kg during the week.
Open interest of the same contract was recorded lower at 16,730 lots on last trading session against 20,350 lots on Monday.
JEERA: Spot Jeera major markets remained closed during the week due to financial year-end, said trade sources.
Other hand, on futures market (NCDEX), Jeera futures for delivery in April during the week declined by Rs.85 or 0.59% at Rs.14,520/100kg.
Open interest for the same contract on last trading day (Wednesday) was recorded lower at 7,341 lots versus 7,914 lots on Monday.
Other hand, Indian Jeera exports have been robust this year despite high prices as the country continues to dominate the global market.
Turkey and Syria are the other significant producers. Turkey is expected to enter the world market by the middle of the year. Supply from Syria is likely to get affected by the on going geo-political conflicts in the country, said the exporters.
Higher overseas demand and internal consumption are expected to cap the fall in jeera prices, they added.
India had exported 119,000 tonnes of the commodity in 2016-17, as per Spices Board India.
Jeera production this year is pegged around 69.23 lakh bags (55kg each) against 59.32 lakh bags in last year, said Mr.Ashwin Naik, chairman of Federation Of Indian Spice Stakeholders in an interview.
Further, domestic and export demand remained poor at the moment as the market participants were expecting correction after recent jump in prices up to a level of lifetime high though the demand is expected to pick up pace due to empty pipeline, said Mr.Ashwin.
Jeera long term outlook is positive despite of higher production estimates as the supply will get tighter due to lower carryover stock this year, he added.
TURMERIC: prices performed negatively this week at benchmark Nizamabad market as the market was opened for 1 day during the week due to financial year-end, said market sources.
Business activities were recorded dull as the major market participants were busy in filing returns for financial year 2017-18, they added.
Other hand, export demand is on lower side as they expect some further correction in prices with the expectation of new crop arrival will increase at major markets, they added.
In Tamil Nadu, the production is lower this year, hit by rain deficit in the state. But the shortage has been compensated by other states.
As per trade sources, Turmeric production is pegged around 64 lakh bags (70kg each) as compared with 67 lakh bags a year ago.
Looking at current fundamentals and the crop report, turmeric will be under pressure in the short term, but it will draw support at lower levels on export demand revival in the next few months.
On NCDEX, Turmeric futures for delivery in April drifted lower by Rs.48 at Rs.6,614/100kg during the week.
Open interest for the same contract was recorded lower at 7,240 lots on Wednesday against 7,810 lots on Monday.
RED CHILLI: Red Chilli Teja variety prices remained unchanged during the week ended on Friday.
While other variety prices were quoted as per the quality of the stock arrived at the marketplace, said market sources.
Premium deluxe quality stock was traded at higher prices amid limited availability due to virus/attack while medium and medium best variety were traded lower due to ample availability.
Arrivals at Guntur benchmark market remained lower as compared with previous year due to low production estimates on the back of lower acreage.
Furthermore, market activities were also affected due to the financial year ending.
As per a Mumbai based veteran trader, production this year is pegged around 2.25 crore bags against 4 crore bags (40kg each) in last year.
Red Chilli outlook is not certain amid lower production estimate this year against ample availability of previous year's stock.
(By Commoditiescontrol Bureau; +91-22-40015522)
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