EXPECTATIONS of a smaller than normal cardamom crop in the world’s top producer Guatemala are the main reason behind current high prices for the spice, according to those who are active in the sector.
Traders who spoke to said that prices recently increased by between 10% and 20% due to a lack of material arriving from Guatemala.
One UK trader said that he had heard that the crop will fail to reach its normal level. However, he cautioned that, since the harvesting season has only recently started and will continue until May, it is too early to put anything more than an estimate on the actual crop size.
“We were told recently that the crop could be down by more than 10% from normal levels, so that’s why prices are high, ” he said.
Guatemala typically produces around 23,000 tonnes a year.
A Dutch trader said that the actions of traders in Guatemala were also contributing to the current high price of cardamom. “A lot of collectors have been buying aggressively and holding the material back, which has helped to push prices up;
the market has been in the doldrums for the last three years and they would like to see the market move back up again, ” he said.
However, any recovery to previous levels would take longer than one season, the Dutch trader said.
He added that stocks of cardamom were now quite low in Europe and the Middle East, which was bringing demand more quickly to origin.
Meanwhile, in India, which produces large quantities of cardamoms but also consumes so much that it sometimes has to import from Guatemala, the Cardamom Research Board of the Spices Board has quelled rumours of a massive fall in the country’s cardamom production.
J Thomas, director of the institute, said that, despite rumours among growers that production would decline by 30% to 35%, it would be down by 10% at the most.