INDIAN spice traders have seen major increases in the country’s cardamom prices due to an uptake in demand which has emerged following reports that Guatemala is facing a much smaller crop in 2006/07.
As reported in earlier this month, trade estimates have pegged Guatemala’s latest crop in the region of 21,000 tonnes compared with 25,000 tonnes in 2005/06 and 32,000 tonnes in 2004/05. Subsequently, Indian traders told the country’s Financial Express newspaper that cardamom prices have been rising and touched an average of Rs377 ($8.54) a kg during an auction at Kumily on February 7.
The Spices Board sent a team to assess the Guatemalan situation nearly two months ago and is understood to be studying the report.
Indian sources said that solid export demand is now driving prices upwards and that much of this buying has come from Saudi Arabia where importers are turning to India to cover their requirements because they know that Guatemala will be unable to meet its export commitments.
The Spices Board has pegged India’s own output 15% lower than last year’s official figure of 12,500 tonnes. However, the trade estimates had pegged last year’s crop at 14,500 tonnes. A final assessment of the current crop is expected sometime around March when the picking season will have come to an end.
Reflecting the trend of growing demand, arrivals at a recent auction at Kerala Cardamom Processing and Marketing Company at Kumily were as high as 72 tonnes.
Traders in the country said that in view of the fact that it is nearly the end of the season such a quantity of arrivals indicated that growers have decided to enter the market with their carryover inventories in the hope that they will get a reasonable price in the Rs350 to Rs400 a kg range.