A bullish sentiment is likely to prevail in the spices market throughout this year as output is expected to decline due to unfavourable climatic conditions and crop diversion.
According to the latest report by the NCDEX Institute of Commodity Markets and Research (NICR), the education and research arm of the National Commodity & Derivatives Exchange (NCDEX), the outputs of all spices are likely to decline to the tune of about 20-25 per cent.
Market sources say that the pepper output in 2008-09 is likely to stand at around 45,000-47,000 tonnes against the normal output of a normal crop size of 50,000-55,000 tonnes.
Kerala is expected to produce 25,000 tonnes of black pepper and Karnataka is likely to contribute 20,000 tonnes. Tamil Nadu is likely to produce 2,000 tonnes.
The domestic demand of pepper remained high during the month due to the winter season.
This season’s harvesting has began in Vietnam, the world’s largest producer of black pepper, and 100,000 -110,000 tonnes is expected this year. India is, thus, likely to keep aloof of the global pepper market because of strong fundamentals, especially on the production front.
| GAINING FLAVOUR Spices output snapshot (tonnes) | ||
| Commodity | 2007-08 | 2008-09* |
| Black pepper | 53,000 - 55,000 | 45,000 - 47,000 |
| Chilli | 920000 | 735000 |
| Jeera | 90000 | 75000 |
| Turmeric | 180000 | 160000 |
| * Forecast | ||
According to the Spice Board of India, pepper exports fell by 31 per cent to 19,100 tonnes for the period April to December 2008 owing to the global financial crisis.
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The report further said that the harvest season of chilli began in January, which will continue until April.
Prominent growing regions such as Andhra Pradesh had produced 150-160 lakh bags (1 bag=40 kg) of red chilli last year, which is likely to squeeze to 110-115 lakh bags as acreage had declined by 25-30 per cent.
According to the Spice Board, chilli exports fell 5.85 per cent to 141,000 tonnes for the period April to December. However, the coming months may witness export demand from Malaysia, Thailand, Singapore and Sri Lanka, the report said.
The chilli market is likely to rule firm on the back of less crop size this season.
The commodity which witnessed damage due to untimely rainfall in the major producing regions of Karnataka and Andhra Pradesh may see an overall decline of around 20-25 per cent in output.
Jeera market is likely to remain upbeat as production is likely to decline by 20-25 per cent this year due to unfavourable weather in the cultivating areas of Gujarat.
The output of the prominent spices variety in the country is likely to be around 14-15 lakh bags. India’s jeera crop will be the earliest available to meet world demand as produce from other major producers, Syria and Turkey, will arrive by July and August.
According to the Spice Board, jeera exports increased by 51 per cent to 28,500 tonnes owing to the crop failure in Syria, Turkey and Iran for the period April to December, 2008.
Turmeric production for the coming season is expected to lower to 4 million bags against 4.5 million bags last year owing to bad weather conditions and shift in acreage mainly in favour of cotton.
Carryover stocks for 2009 are seen at 500,000 bags (40 kgs each) against 1.2 million bags last year due to lower output in 2008. According to the Spice Board of India, turmeric exports from the country rose 10 per cent to 40,000 tonnes during the period April to December.
Meanwhile, black pepper, chilli and turmeric prices in Delhi fell by Rs 100 each at Rs 13,100-13,300, Rs 5,200-7,900 and Rs 5,300-6,900 per quintal respectively on selling pressure. Jeera dropped by Rs 200 to Rs 10,900-11,300 a quintal.