Cardamom prices look firm on drop in arrivals

Cardamom auction prices have increased, thanks to a drop in the arrival of cardamom at the various auction centres in recent weeks. During the week, the price of average-quality cardamom crossed the Rs 400 mark to touch Rs 405 at Kumily auction centre.

KCPMC, Kumily quoted the highest at Rs 517 and CPMCS, Kumily quoted at Rs 502. The average price quoted at other centres was between Rs 380 and 390.

The supply to various auction centres has increased recently. KCPMC had an arrival of 49 tonne today.This is mainly due to holidays during the current week and the imminent end of the auction season. A few weeks back, the supply to auction centres had dropped by around 50 per cent and the average arrival was 25-30 tonne.

The shortage in the supply of cardamom has caused a spurt in prices. Traders expect a further appreciation in the tags in the coming weeks. Given the reducing supply of cardamom, the average price may touch Rs 440 -450 a kg. But, the increase in the prices will not fetch better realisation to the farmers since most of them have already sold out.

Another factor influencing the current movement of the market is the summer showers. Although some areas of Kerala had received heavy summer showers, the cardamom-growing areas in the Idukki district of Kerala have so far not received rainfall.

A leading grower in Idukki district told Business Standard that unless there were heavy summer showers within a fortnight, the next season will be disastrous to the cardamom market.

Cardamom plantations may dry up because of the extreme summer heat. During these weeks, new shoots come out of cardamom plants and heavy rainfall is very essential for the growth of the shoots.

The domestic cardamom market runs mainly on internal production rather than imports from Guatemala. Since imports are not much, the domestic stock will be exhausted by May - June.

An improvement in production is thus crucial for the current price level to be maintained in the next season. And, rain is the most crucial factor for cardamom production.

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GOING STRONG

Given the reducing supply of cardamom, the average price may touch Rs 440-450 a kg

Another factor influencing the current movement of the market is the summer showers

The domestic cardamom market runs mainly on internal production rather than imports from Guatemala