Turmeric prices may witness some correction following large carry-over stocks and lower demand in the export market this year.
"With large carry-over stocks of more than 15 lakh bags (each bag of 75 kgs), and a bumper crop of 100 lakh bags last year, the Indian market is sitting on a stock of more than 115 lakh bags of turmeric," Sangli Chamber of Commerce President Mohanlal Sharda said here.
"India's annual consumption estimates are in the range of 65 lakh bags per annum. Thus, we at present have stocks which India will take two years to consume," he added.
Estimates range that sowing this year may be 50-60% of last year. The normal monsoon in all major sowing belts of turmeric, may assume coming year's harvest to be in range of 65 lakh to 75 lakh bags.
The huge carry-over stock for the next two years has led to a view in the market that prices may even break the lower levels of Rs 2,500 per quintal, which was seen during 2009-10, leading trader Ajay Dalal said.
Current prices of turmeric in Erode mandi of Tamil Nadu range from Rs 3400-3600 per quintal, while Nizamabad mandi in Andhra Pradesh quotes Rs 3,200-3,600 per quintal, and Sangli mandi in Maharashtra quotes Rs 3,300-3,700 per quintal.
With a rise in production over the last two years resulting in bumper harvests, prices seem to become heavily reliant on stockists to sustain them for this year, Sharda said.
"Along with a huge stock of more than 115 lakh bags and an estimated 50-60 percent sowing this year, I fear prices may not recover from current levels, but in-fact slip down further as even demand has slowed down at present," Dalal said.
Data also shows that the turmeric exports from India in the last six months have already surpassed the total of last year's exports and that the export market is sluggish at present.