Dispute may hit cumin exports

The country may lose the opportunity to export cumin seed to the US, if the ongoing dispute is not resolved.

The controversy broke out as the FDA recently rejected the entire shipment of around 1,700 tonne of cumin seed, exported by seven-eight exporters "� largely from Mumbai "� reportedly on grounds that it contained weetseed "� a contaminant.

Spices Board, the government body regulating spice exports, is visiting the US next week to hold talks with US Food and Drug Administration (FDA) officials in a bid to resolve the issue.

Of the controversial shipment, Unjha-based traders had contributed about 200 tonne while the rest came from Mumbai-based traders.

"Although there are little chances for cancellation of the entire shipment as the visiting team of industry and government officials would press for FDA using it for grinding purpose, about 500 tonne may be rejected," said Yogesh Mehta of Indian Spices & Foodstuff Export Association.

"The US is a major market for us and we set a target to export about 15,000 tonne this year. Importantly, we had an initial export target of around 6,000 tonne in April-May. But because of this quality problem, exports may be hit," he added.

The shipment was expected to harboured back to India last week but is still awaiting the FDA nod in the US.

Despite the news of rejection, Unjha traders are upbeat about export demand and rising prices in the domestic market. They are making huge cumin seed stocks in their warehouses in anticipation of good exports to the US, Europe and the Arabian countries.

About 400-500 tonne of cumin seed changed hand last week in Unjha alone, and of that 300 tonne was booked by one trader, sources said.

The traders paid as high as Rs 1,300-1,325 per 20 kg against the prevailing market price of Rs 1,150-1,200 per 20 kg. According to industry sources, traders are ready to pay any amount to build inventory for future exports.

"In fact, US importers are seeking a price cut. We are currently exporting at $1,650-1,750 a tonne, but the shipment would probably be accepted if the rates are slashed by $150-200 a tonne," said Sachin Patel, an Unjha exporter.

About eight containers (200 tonne) of cumin seeds contain azoto bacteria, and are sure to be sent back to India, but the entire shipment would not be sent back, felt Arbind Patel, ex-president, Chamber of Commerce, Unjha. No adequate measures for safety of the goods were taken by exporters for protection from the bacteria, he added.

Indian Spices & Foodstuff Export Association estimates a total production of 18 lakh bags (60 kg each) in and total availability of 25 lakh bags with an opening stock of 7 lakh bags.

Cumin seed prices have gained approximately Rs 400 in the last one month owing to rising export demand. If the trend continues, the stocks would come down at the zero level this year.