Speculative buying props up cardamom

Cardamom prices, which had fallen last Friday, shot up by 9 per cent across all contracts on Monday on the Multi Commodity Exchange (MCX) following heavy speculative buying at lower level.

Cardamom price for the near month contract was quoted at Rs 429, while that of far month contracts, including November, December and January 2007, were quoted at Rs 455.50 per kg, Rs 474 per kg and Rs 487 per kg, respectively.

"Fundamentals do not change in a day and, hence, there is no reason why a commodity would gain 9 per cent on Monday which lost equally previous day," a trader said.

According to market players, fundamentals favour a rise in the prices. The crop was damaged by about 30 per cent owing to massive rainfall in the major cardamom producing centres, including the South.

Total output is estimated to decline in the similar proportion to about 9,000 to 10,000 tonne this year against the total production of 12,000 tonne last year. Therefore, the price has started picking up which would continue, the trader said.