Indian cardamom shows bearish trend

Indian cardamom prices have been subjected to downward pressure of late due to 2012 crop carryover stocks of about 2,000 tonnes and the early start of harvesting of this year’s crop.

In a July 16 market report, Emperor Akbar Green Cardamom of Mumbai confirmed that harvesting of the new crop had started early due to favourable rainfall.

Production was estimated to be about 20% more than last year with the quality of the crop being very good.

“As estimated in our previous report, we expect about 3,500 to 4,000 tonnes exportable surplus to be available this year. With prices being low, the domestic market has picked up good quantity stocks in the last couple of weeks while the international markets are watching the increased arrivals from the new crop before beginning their purchases,” the report added.

With good quality and quantity of production, along with low prices, this was expected to be a good year for the cardamom industry, the company noted.

“Barring unforeseen circumstances, we expect the prices to be range bound (+/- USD2.00),” Emperor Akbar said. It suggested that there might be some fluctuations during the festival season in India, which begins around the end of this month. “However, there should not be large volatility this year,” it added.

Emperor Akbar felt that this should encourage new buyers in new markets to venture into buying Indian cardamom. “We are seeing renewed interest from the US and European markets in Indian Cardamom with buyers now putting a premium for the better aroma of Indian Cardamom.”

In a July 12 report Mumbai trader and analyst Kotak Commodity Services observed that cardamom on the Multi Commodity Exchange had been on a downward trend for the last five months. The company suggested that the medium term trend remained bearish.

Meanwhile, Andrew Barker, managing director of PBA Brokerage, told that there had been very little international trade in cardamom of late. Initial indications from Guatemala were for an even bigger crop in 2013/14. Harvesting is expected to get under way from late August or early September.

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