The downward trend continued in turmeric futures on the back of higher stocks from the fresh crop along with higher production concerns. Demand from the overseas and domestic buyers remained lower lending support to the bears in the market.
Rates are falling for turmeric as higher arrivals of the new crop prevented any major uptrend for the commodity. With increased arrivals, the uptrend may be limited till demand picks up. Expectation that arrivals might gain momentum in the coming days is restricting prices from trading higher.
Good stocks and increased selling pressure along with weak demand in the Mandis have kept trend weak for the commodity over the last few weeks. Production of turmeric is expected to touch historical level of eight hundred twenty thousand bags in 2011-12 season.
The sowing period is from June-August and harvesting begins in January. High moisture content in the current crop kept demand low and thus kept pressure on the market prices. With an expected five to six hundred thousand bags of old stocks with farmers, there are expectations of higher arrivals of these stocks in the markets before new crop arrivals.
Exports of turmeric during April to November rose 63% to 58,000 tonnes as compared to 35,500 tonnes in the same period previous year. However, exports for the month of November 2011 declined by 5.9 percent. The target set by the Spices board have already been achieved and has touched new historical high of 58,000 tonnes in the eight months of the FY 2011-12.
Yesterday on the NCDEX the turmeric April contract closed down by 2.32% at Rs.4552 ($90.31, €68.83, £57.47) per quintal against the previous close.