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Cardamom sector in for tough times

Cardamom sector in for tough times

Mon July 09 2018

 

After record exports last year, India’s trade in small cardamom could be headed for a rough patch. Traders said shipments to Saudi Arabia have slumped and production is expected to plunge due to adverse weather in the new season.

 

The decline in arrivals and robust domestic demand have raised the price of the spice by 15-20% over the last six weeks to Rs 1,000 per kg, according to traders.

 

“Exports to Saudi Arabia have virtually stopped in the last couple of months with the government tightening the standards for pesticide monitoring and rejecting some Indian consignments,” said SPGR Nityanandan, a leading exporter.

 

At present, some shipments are going to other Gulf countries like Kuwait, Dubai, Abu Dhabi and Bahrain. But unlike the bulk purchases made by Saudi Arabia, the volumes to these countries are comparatively low.

 

In 2017-18, heavy buying by Saudi Arabia had boosted Indian cardamom exports to a new high of 5,680 tons, valued at Rs 609 crore. It represented an increase of 48% in quantity and 45% in value terms from a year earlier.

 

Exporters had taken up the issue with the Spices Board. “Unless the Centre takes action by initiating talks with Saudi Arabia, the cardamom sector in the country will be in doldrums,” Nityanandan said. “Our buyers in Saudi Arabia are not against accepting orders, as Indian cardamom is of superior quality.”

 

Harvest of cardamom this season started in June, over a month early this year due to heavy summer rains in Kerala, the top producing state. But the southwest monsoon has also been intense, accompanied by strong winds. “The production is likely to be down by 40% as many plants have been damaged,’’ said KS Mathew, a grower.

 

Large inventory from a good crop last year is almost getting exhausted and growers reckon what is left may be sufficient only for the next few weeks. “If the arrivals don’t pick up then there is likely to be a gap in supply after a month,’’ Mathew said.

 

The setback in export is at present being compensated by a strong demand from the north Indian market, which is keeping the price at Rs 1,000 per kg. Cardamom prices used to hover around Rs 1,000-1,200 kg some months ago and they fell to about Rs 800 per kg level in anticipation of good crop early this year.

 

Source: https://economictimes.indiatimes.com/

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