Cardamom prices may surge to Rs 750 a kg

Cardamom prices are likely to witness a sharp rise unless there is a quantum leap in the imports, mainly from Guatemala.

According to the projections by leading growers of Idukki district in Kerala, the prices may touch the Rs 700-750 a kg level by the beginning of next year as arrivals to major auction centres have declined considerably, indicating a fall in production.

But they said illegal imports through Nepal and Bangladesh borders may put some brake on the rising prices of cardamom. It is estimated that 3,000-3,500 tonnes of cardamom are imported illegally into the country.

Production season in Guatemala will be set in motion by next month and Indian commercial users are gearing up for imports in order to thwart the anticipated hike in local prices.

The best quality cardamom is currently fetching Rs 500-550 a kg while the average prices at various auction centres have gone up to Rs 425-450, Rs 100 more than the last year's prices.

Guatemala offers the cheapest cardamom across the world as the average cost of production there is in the range of Rs 130-150 a kg, while this is Rs 350 in India.

This cost advantage places Guatemala cardamom at a better platform and Indian companies prefer to import the product through illegal means.

Meanwhile, daily arrivals in various auction centres have dropped to 20-40 tonnes. A week back, these centres were receiving 70-75 tonnes daily.

Leading growers said that total production in Idukki district, which produces 70 per cent of the country's total cardamom, has been 6,000 tonnes, a drop of 2,000 tonnes against last year. The total countrywide production is estimated at 9,000 tonnes against the average annual production of 11,000 tonnes.

The movement of the market depends a lot on imports from Guatemala. A leading grower said that sharp increase in domestic prices was dangerous as imports would increase manifold.

"A price range of Rs 400-450 will be ideal," he said. The growers here are building up pressure on various political parties as well as on the Central government to strictly control the illegal cross-border trading during the off season. Farmers are hopeful of some government action to protect their interests.