Cardamom prices heading north

With cardamom production in Kerala's Idukki district expected to decline by 30 per cent, the prices are likely to go up in 2007.

According to leading growers and experts, the new crop season will be delayed by at least one month as plucking was yet to pick up in most of the plantations. Some of them said the new season may start only in September as monsoon and strong winds had destroyed plantations in many parts of the district. Although the first auction of the season began recently, arrival was poor with about 40 tonnes traded last week. Jose Valy, a leading planter, told Business Standard that the arrival of the fresh crop was very limited and all the auction centers were dealing with old stocks at the start of the season. At the first auction, cardamom of average quality moved in the range of Rs 400-430 per kg.

A top official of a commodity exchange said that there was a dearth of good quality cardamom and the 7 mm cardamom could attract a price range of Rs 560 -570 per kg in the open market. The initial crop of the new season may not attract higher tags as the size and quality of the crop were low. The good quality cardamom of the new season is expected to hit the market only by November-December, as the season progresses, and harvesting may spill over to the next year. India has an average yearly production of 11,000 -12,000 tonnes.

While droughts in April-May had severely affected cardamom plantations in the main production centers of the district, the recent heavy rains would lower total production by at least 30 per cent, according to commodity experts.

Hence cardamom may move in the higher price range during the current season. The market parameters indicate a price level of Rs 600 per kg thanks to lower production. Compared to the beginning of the last season, auction prices have appreciated by Rs 180 -200 per kg, strongly indicating lower production and buoyant market for the spice. During the last season, arrivals were picked up by the middle of July, but this time it will be delayed by at least four weeks. The average price in the auction held in June 2006 was Rs 230 per kg.