Firm cardamom prices cast doubt over high-end crop estimates

EUROPEAN cardamom dealers are becoming increasingly convinced that the 2010/11 Guatemalan crop will come in at the low range of estimates as opposed to the more optimistic forecasts, as prices remain firm.

In December, one group of exporters in Guatemala was convinced that the crop should amount to more than 24,000 tonnes and that prices would decline in the first quarter of 2011 (see , December 17, page 10).

In contrast with this, another contingent of exporters was of the firm opinion that the crop would be around 17,000 to 18,000 tonnes, which would match the range estimated for the 2009/10 crop.

On January 14, one Rotterdam trader told  that his information indicated that the crop would end up in the low range of estimates, as reflected by the 20% to 30% advance seen in prices in the last few months. The exporter observed that the claims of a 24,000 tonnes-plus crop came from two exporters that were trying to protect their short position.

Andrew Barker, managing director of PBA Brokerage, said that main sway of opinion was now veering more towards the lower range estimates than the high. However, he cautioned: “Nobody will really know until April or May because it is still being harvested.”

Prices reveal all

The Rotterdam trader added: “Prices have moved up considerably during the last two months and are holding high levels. There are not many offers – only limited quantities for the various grades – and the stocks in the various consuming countries, especially in Europe, but also in the Middle East, are small.

“There is still quite a lot of demand expected for the Ramadan season from the Middle East, and Europe also needs to cover substantial quantities, so we can expect some further squeeze and also an increase in the prices.”

The trader quoted mixed yellow qualities (MYQ) at $21 a kg c&f, bold greens at $29 and seeds at $32.

Mr Barker said it was possible to obtain MYQs at $20 a kg c&f from origin and at $21 to $22 a kg from resellers. He viewed the Rotterdam trader’s price indication on bold greens as over-inflated and explained that he could get small whole green cardamoms at $24 a kg c&f, mediums at $25 and large at $26.

Mr Barker added: “Demand is flat at the moment – there is not a huge amount of demand at these levels. People are just buying hand to mouth, but if the crop is small that won’t worry the exporters, because it is a sellers’ market.”

Most exporters are not offering a lot of medium to large whole greens. “That would indicate that there is a serious shortfall in the market this year,” he noted.

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