INDIA’S Spices Board is making moves to halt the illegal entry of cardamom into the country.
The board has alerted the commissioners of customs at major ports to take action against illegal imports through land-locked and border countries, such as Nepal, Bhutan, Bangladesh and Pakistan.
Although the imports are officially estimated at a mere 200 tonnes, Indian traders believe that more could have entered the domestic market illegally.
Faiyaz Hudani, senior analyst at Kotak Commodity Services, said that debate over the actual volume was largely immaterial as there was no official data collected. “Any kind of smuggling will impact the domestic market, leading to higher imports and higher availability, which in turn would lead to lower prices. Anything which is hampering the domestic market is not good for the Indian market.”
Mr Hudani noted that this was a common practice in a number of key Indian spices as industry suppliers looked to avoid paying import duties.
Despite the fears of a major slide in prices, at the auctions good export buying helped prices remain nearly steady despite slack demand from upcountry markets. Exporters were estimated to have bought 70 tonnes of 7mm good colour capsules last week.
The individual auction average prices moved between Rs680 ($12.32) and Rs740 a kg on slack domestic demand. Arrivals showed a marginal rise following release of stocks held by growers of the second round of harvesting in October to November, market sources claimed.
Upcountry demand used to be slack usually during February and hence there is a decline in sales, traders said. Total arrivals last week stood at around 325 tonnes and of this about 315 tonnes of capsules were sold.
Exporters were said to be purchasing good colour cardamom of above 7 mm variety at Rs 850 to Rs870 a kg.
According to Indian traders, cardamom from Guatemala is smuggled into India through some of the neighbouring countries and that has been impacting the price of the indigenous produce.
Exporters claimed that bear operators were taking this opportunity to pull the prices down. This was why prices had declined in recent days from above Rs800 about three weeks ago, they alleged.
A Spices Board source said the total import duty through the authentic route is around 80.9% and when this rate “is applied by the customs on the tariff value, the price outcome is unlikely to upset the current auction average price”.
There was said to be moderate demand for good quality capsules having good colour and bold above 7 mm. Exporters were actively covering this variety at the prevailing prices, the Spices Board source said.