Leading commodity bourse MCX has increased the margin--amount investors need to deposit for trading--in cardamom futures by 10 per cent effective today. With this hike, buyers need to deposit 17.06 per cent of the value of cardamom they intend to take in. Earlier, the margin was 7.06 per cent.
"As a risk management measure, the exchange has decided to levy a special margin of 10 per cent on buy side in cardamom contracts," MCX said in a circular. The extra margin is applicable to both commodity brokers as well as individual traders, it said.
"Margin is increased on buyers to curb excessive volatility in cardamom prices which have risen 15 per cent in last one week on higher domestic and global demand amid poor supply of the commodity," commodity brokerage firm Karvy Comtrade's analyst Veeresh Hiremath said.
Cardamom futures prices have reached Rs 1,565 per kg from Rs 1,358.40 per kg over the last four trading sessions, he said. At 1100 hours, cardamom for May month delivery was trading firm at Rs 1,575 per kg, while that of June contract at Rs 1,455 per kg.
Production of cardamom, which is largely grown in Kerala, is expected to be down 15 per cent this year. Last year, as much as 95,000 tonnes of cardamom was produced in the country, according to trade data.
Meanwhile, spot prices also stood firm at Rs 1,344 per kg at Vandanmedu in Iduki district of Kerala, which is the country's largest physical market for cardamom.