Daily Report of International Spice Commodities
Pepper futures edged lower on profit booking after extended rise for two days. Broad sentiments remained positive however limited activity in the physical market created liquidation pressure. Indian domestic consumption also expected to increase during this period since most of the festivals are celebrated during this period. According to IPC the world pepper production in 2011 is estimated near 310000 tons and the projected demand is expected near 330000 tons. However slowdown in European and US economy cast doubt on aggressive procurement until economy recovery gain momentum. On the other side, strengthening of dollar against rupee added more cushion for exporters for competitive pricing. Spot prices moved in tandem with futures and traded near Rs 30200 per quintal.
Cumin futures ended with slight negative bias on slow down in demand. Physical market gained the earlier momentum in arrivals. Spot prices traded firm and traded near 14000 per quintal and arrivals were reported near 6000 bags compared with 5000 bags in the previous day. Cumin is cultivated during rabi season from October to December and harvested in February to April. As per media sources , cumin cultivation in Gujarat estimated near 65.77 lakh hectares compared with 87 lakh hectares in the previous year same period. Syrian and turkey had already started reaching the international market and the expected total output near 45000 tons. And the reported poor quality produce from Syria will give more competitive edge to Indian cumin seed in the international market.
Turmeric futures continued its bearish sentiments since higher production and amble stock availability strengthened the bearish mood. Slow down in demand from north Indian buyers as well as bulk dealers also supported the sentiments. Buyers adopted cautious approach since proposed Lorry Strike from 18th of this month can create logistics problems. Nizamabad spot market traded near 6800 per quintal and arrivals were reported near 1500 bags. Spot market in Erode traded near 6000 and arrivals stood at 5000 bags compared with 6500 bags previous day. As per media, current stock position was reported near 42 lakh bags, which is 20 percent higher than the previous year figure. Production in 2010-11 is estimated near 69 lakh bags compared with 48 lakh bags in the previous day.
Cardamom futures continued its bearish mood on higher stocks availability and feeble demand in the physical market. According to last updates, average spot prices remained weak and traded near 583.23 per kg and arrivals are reported near 24 tons compared with 67 tons previous day. According to trade estimates production in India is slightly higher than 12000 tons. As per the estimates of spices board the production in Guatemala expected near 20000 tons. As per media sources , total arrivals during the current season from August 1 to July ,2011, stood at 12973 tons which is approximately 32 percent higher than last year arrivals.
Chilli futures turned higher on improved demand scenario in the physical market. Spot market prices traded near Rs 8700 per quintal and fresh arrivals were reported near 25000 bags compared with 15000 bags in the previous day. Weak monsoon in Andra Pradesh had slowed down the sowingprogress in that region. As per official estimates it is 17 percent less than previous year. Meanwhile sowing was almost completed in some parts of Madhya Pradesh. As per market sources, total stock in Guntur is expected around 47-48 lakh bags, out of this quality produce is expected around 30-35 lakh bags. Monsoon is crucial for better chilli cultivation.
Coriander futures cascaded on sluggish demand as well as higher arrival in the physical market. Spot prices in kota trade near 4000 per quintal. Total arrivals were reported near7100 bags compared with 8000 bags previous day. Total carry over stocks has been estimated 25-30 lakh bags. Erratic weather condition during the sowing period had decreased the acreage under cultivation. As per Ncdex reports, Coriander production in 2010-11 is estimated to be around 2.8-3 lakh MT. And for the year, 2010-11, India exported 40500 MT.
Pepper futures decline on liquidation
Kochi: Pepper futures market on Thursday dropped after rising sharply during the past couple of days on liquidation amid limited activities. Speculative long position holders were liquidating while buying interest was limited. Total turn over dropped sharply.
Moisture content: Sellers were quoting higher prices while the buyers, citing high moisture content, were offering lower rates, market sources toldBusiness Line.
On the spot some few lots were reportedly traded at Rs 293-295 a kg. August contract on the NCDEX fell by Rs 304 to close at Rs 30,978 a quintal. September and October declined by Rs 270 and Rs 238 respectively to Rs 31,851 and Rs 32,170 a quintal.
Turnover slips: Total turn over fell by 3,607 tonnes to 10,120 tonnes. Total open interest declined by 378 tonnes to 10,171 tonnes showing liquidation. August open interest fell by 316 tonnes to 405 tonnes while that of September fell by 83 tonnes to 7,813 tonnes.
October moved up by 24 tonnes to 1,682 tonnes. Spot prices, in tandem with the futures market trend and limited activities, declined by Rs 100 to close at Rs 29,200 (ungarbled) and Rs 30,200 (MG 1) a quintal. Indian parity in the international market was at $7,200 a tonne (c&f) and remained above other origins, they added.
Re-exports of cloves cross 1,000-tonne mark
Kochi: Indian re-exports of cloves have crossed 1,000 tonnes so far following severe shortage of the material in the world market. The commodity was shipped out at prices ranging between $17,000 and $18,000 a tonne and, consequently import would not be allowed below $20,000-$22000 a tonne, the trade sources claimed. Having shipped out over 1,000 tonnes from stocks held by trade, there is said to be a squeeze in availability in the domestic market where the demand started picking up for the festival season, market sources said.
Meanwhile, growers in Nagercoil, Tamil Nadu told Business Line that dealers and planters who were holding back their produce because of the ‘Aadi’ month which ended yesterday started showing up but were not ready to sell at the current price of Rs 1,100 a kg. “They are anticipating the prices to rise further,” Mr Subramani, a planter, said.
According to him, Kannyakumari district is a major producer of cloves with an estimated over 1,000 tonnes against the total Indian production ranging 1,500-2,000 tonnes. He said the next crop in (Marumalai) one area is above average while that in ‘Karuparamalai’ area is comparatively poor.
Prices zoom: Price of the imported cloves, at present, ranges between Rs 980 and Rs 1,200 a kg depending upon the quality and colour in the Indian domestic market with chances of moving up further as demand picks up for the festival season, they said.
Overseas reports said “cloves prices hit the roof, with the local prices in Indonesia touching 21,00,000 rupiah, it means $25,000 a tonne, signalling that cloves this year will touch record high. Other origins are at $14,000-20,000 a tonne”, import sources in Bangalore claimed.
“Consequent to soaring prices lower rate contracts are defaulted, many cargo contracted by Indian importers have been settled or defaulted, there is a huge shortages of cloves in India”.
Crop failure in Indonesia following damage to plants by disease, the production has dropped sharply and it is expected to take 3- 4 years to return to the normal conditions.