Festival demand set to lend support to Indian cardamom
INDIAN spice dealers are expecting strong domestic demand for new crop cardamom to help underpin prices of the spice.
In an August 30 market report Emperor Akbar Green Cardamoms of Mumbai said that domestic festival demand would start in a few days and this would coincide with new crop arrivals. “Most of the domestic consumption centres and the supply chains are currently carrying very little or negligible stocks. Hence, we expect the domestic demand to give good support to the new crop,” the company stated.
Newspaper reports that the Forward Markets Commission was considering stopping forward trade in cardamom had helped curb the speculators and reined in the prices at the online exchange platform.
“This will help traders and planters and keep the prices in check based on fundamental factors. With Indian demand estimated between 12,500 to 13,500 tonnes, we will have about 2,000 to 3,000 tonnes for export which, though lower than last year, is in line with market expectations,” Emperor Akbar said.
The first picking of the latest crop was under way in the cardamom growing areas of Kerala. In some plantations, the second picking had also just started. As expected, the quality of the second picking was better than that of the first.
Emperor Akbar noted that this month would see the new crop starting to arrive in good quantities and favourable quality.
Revised estimates now pegged total output at between 15,000 and 15,500 tonnes. “Fresh rainfall from now until January will not increase the quantity of production but will help in improving the quality,” the company noted.
Traders liquidating old crop stocks
The delayed monsoon rains and resultant delay in the new crop had helped traders to liquidate their stocks of previous crop material.
However, Emperor Akbar cautioned that some stocks from the old crop were being sold and blended with the new crop. Moreover, due to the large jump in India’s cardamom exports last year, a lot of new firms had ventured into exporting the spice.
“It is important that the standardised grading of Indian cardamom, which is the touchstone of Indian cardamom, is maintained at this time. This is the basis on which Indian cardamom has built its reputation over the years,” the company urged.
Emperor Akbar was expecting prices to start edging up from this week onwards as festival demand caught up with the onset of the new crop. “We estimate a jump in the prices by about $1 per kg by the end of September,” the company added.