Cuminseed prices to dip on high output

Traders expect a bumper crop in Gujarat and Rajasthan this year; prices will go down further by Rs 50-100.

Prices of cuminseed (jeera) are set to fall in Unjha mandi in north Gujarat, the largest market for cuminseed in Asia, as traders expect a bumper crop this year. Prices are currently quoting at Rs 1,100-1,200 per 20 kg bag.

Gujarat and Rajasthan are the largest producers of cuminseeds in the country. Gujarat is expected to produce 21.22 lakh bags, each comprising 55 kg, this year, while Rajasthan is expected to produce 4 lakh bags, making it the second largest producer in the country. Every year about 20 lakh bags are sold across India from Gujarat, a source said.

In fact, the current prices are cited to be the lowest in the last five years following huge surpluses at godowns.

From 2002 to 2005, prices have remained between Rs 1,300 and Rs 1,800 per bag. However, this time as there is a carryforward of about 4.5 lakh bags, prices have dipped to Rs 1,100-1,150 (for old stock) per 20-kg bag, according to a top official from a traders' association at Unjha.

Prices will go down further by Rs 50-100, he said adding that even the export market was not favourable. The carryforward stock for 2005 was about 7 lakh bags, a market source said. The area under cultivation has also risen to 30 per cent approximately compared with last year.

As many as 500 bags of fresh produce are making their way to Unjha's mandi and by next few weeks 5,000 bags will be available here. The prices of fresh stock are between Rs 1,180 and Rs 1,250.

"The markets are down and a week ago the price stood at Rs 1,275 per bag, which is now Rs 1,225 for fresh stocks," according to Dilip Patel, a leading trader at Unjha.

It is believed that once 10-15,000 bags start arriving every day in Unjha from the peak season in March, prices will go down to Rs 1,000.

"This is the lowest price in last five years and if it goes lower than Rs 1,000, traders will prefer selling it to stockists." said Ramesh D Thakore, vice president, Vishal Export Overseas Ltd. "There hasn't been much jeera exports this year as the produce is not consistent in size, colour and delivery," he said.

"People will not be able to stock much this year as their godowns are nearly full. However, if exports to Singapore, Japan, Turkey, Syria Sri Lanka and Gulf fructify, then prices will firm up," said Rakesh Jain, a commission agent in Unjha. "Prices will rise only if there is a damage to crops by heat wave or a sudden downpour. In that case, rates are likely to rise by 10-20 per cent," said Dinesh Patel, another trader at Unjha.