Mixed prospects for spices

MARKET OUTLOOK

The long term outlook for spices presents a mixed picture. While chilli and turmeric prices are expected to go down as production is estimated to be much higher than last year, for pepper and cumin seeds it is exactly the opposite.

In the short term, chilli and turmeric prices will remain high as the crop has just started arriving in the market.

Chilli: In the Guntur market, chilli saw prices in the range of Rs 6,000 to 6,800 a quintal on Chinese and Bangladeshi demand. The trend is expected to remain the same next week as several mandis will remain closed till Wednesday due to samkranti and pongal.

The price level, according to traders, may slip to Rs 6,000-6,300 in the subsequent weeks when new arrivals start coming into the market. At present, the arrival in the Guntur market is around 10,000 bags (of 40 kg) per day, which is expected to go up to 15,000 to 20,000 bags next week.

Turmeric: The story is the same for turmeric also. The past week saw the turmeric contract for April delivery oscillating between Rs 1,950 and Rs 1,980 a quintal. Traders said bearishness would come only after March. In the futures market, prices are expected to remain between Rs 1,900 and Rs 2,000 a quintal.

At present, turmeric spot prices in Nizamabad are quoting at Rs 1,750-1,900 a quintal. The stock availability there is around 70,000 bags (each of 70 kg).

According to a Nizamabad-based trader, the next week's movement in futures will depend on the arrivals, which are expected to pick up after February 10. Production this year is expected to go up 15 per cent to around 55 lakh bags from 47 lakh bags last year.

Pepper: The picture is different here. Futures went down from Rs 11,235 a quintal on Monday to a low of Rs 11,040 on Friday. According to analysts, the prices are expected to go up and the range will be Rs 11,150-11,200 a quintal.

Cumin seeds: Though cumin seeds (jeera) prices fell both in futures as well as the spot segment to below Rs 9,000 a quintal mark in the past week, traders said the situation will be reversed in the long run as crop estimates are lower than last year's. Besides, the increasing export demand will also have a significant role to play.