International Spice Market Update – August 06, 2011

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Daily Report of International Spice Commodities

Pepper futures surged in the early session followed with a profit booking at the end of the session. Market couldn’t sustain the buying mood at the end of session and ended with slight negative bias. Spot market continued to trade near Rs 28500 per quintal. And arrivals continued to be limited since farmers are holding the stock for better price realization. As quoted in the media, Brazilian exporters slowed down on expectation that prices will continue to firm up on limited supply in the international market. Summer vacation in international market had reduced the trading activities. International prices for MG1 traded near $6850 and prices in other origin also increased to  narrow down the price spread. And Vietnam had already exported 78000 tons in last seven months.

Cumin futures continued its bearish sentiments on higher arrival in the spot market. Spot prices trade near Rs 14200 per quintals and arrivals were reported near 8000 bags against 10000 bags in the previous day. Slowdown in demand  also pressurized the prices.  As per traders view, the procurement for Ramadhan demand had already reached the end phase. Prospective overseas demand is expected from china  in the coming days, but export demand from other regions had slowed down.   Syrian and turkey had already started reaching the international market. And the reported poor quality produce from Syria will give more competitive edge  to Indian cumin seed in the international market. 

Turmeric futures cascaded on higher arrivals in the physical market as well as slow down in demand. Usually arrivals had to slowdown by this period but higher production this year led to extended arrivals in the physical market. As per the last update, Spot prices in Nizamabad traded near Rs 7000 per quintal and fresh arrival were reported near 2000 bags compared with 3000 bags in the previous day. Spot prices in Erode traded near Rs 6500 per quintal and arrivals were reported near 10000 bags compared with 13000 bags in the previous day.  Lower prices in the physical market and below normal rainfall prediction from IMD augmented the worries of the farmers. However crop cultivation is started in some parts of Andhra Pradesh, Maharashtra and Tamil nadu.

Cardamom futures edged lower due to higher arrivals in the physical market. Cultivation of higher yield varieties together with favorable weather condition had resulted in higher production. However increased exports had supported the prices in near term. According to last updates, average spot prices remained weak and traded near 642.26 per ton and arrivals are reported near 27 tons compared with 70 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 rom August 1 to July ,2011, stood at 12973 tons which is approximately 32 percent higher  than last year arrivals.

Chilli futures escalated on increased buying interest. Spot market prices traded near Rs 8700 per quintal and fresh arrivals were reported near 30000 bags compared with 35000 bags in the previous day. Slow down in overseas demand also pressurized the prices. 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. As per  Andhra Pradesh government estimates as quoted in the media, the Chilli sowing shows a declining trend and major production belts received moderate rainfall. It is 17 percent  less than previous year. Monsoon is crucial for better chilli cultivation.

Coriander futures edged lower on profit booking.  Spot prices in Kota traded near 5850 per quintal. Total arrivals were reported at 22000 bags compared with 23000 bags in the previous day. Total carry over stocks has been estimated 25-30 lakErratic 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 prices decline

In range-bound trading, pepper prices declined by 0.28 per cent to Rs 29,121 per quintal in futures trade today as speculators off-loaded their positions after fall in spot market demand.  However, restricted supply in the spot market and depleting stocks restricted the losses.

At the National Commodity and Derivatives Exchange, pepper for delivery in August declined by Rs 82, or 0.28 per cent to Rs 29,121 per quintal, with an open interest of 9,628 lots. Similarly, the spice for delivery in September shed Rs 19 or 0.06 per cent to Rs 29,605 per quintal, with an open interest of 3,886 lots.

Market analysts said off-loading of positions by speculators on the back of fall in the spot market demand led to the fall in pepper prices at futures trade.

Forex Market

CURRENCY

OPEN

HIGH

LOW

CLOSE

USD/INR

44.20

44.29

44.19

44.27

 

 

 

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