Cardamom prices double on low arrivals

Delayed arrivals in the domestic market have almost doubled the cardamom price to Rs 1,500 a kg from Rs 750 a kg in July 2009. Though harvesting has begun in some parts of Idukki district of Kerala, the largest producer in India, arrival of fresh grades is thin. This will be in full swing only by the end of August.

The moderate rainfall in most parts of the district has enthused farmers and it may lead to a better crop this season. “So far there has been enough rainfall for the growth of the crop,” said a leading Vandanmedu-based farmer. In the latest auction on July 2, the best quality cardamom fetched a price of Rs 1,770 a kg.

According to K M Michel, president, Cardamom Growers Association (CGA), the total production this season is estimated at 10,000 tonnes, almost at the same level as in the previous season.

Since there is good demand due to the festival season, prices would be much stronger in the coming weeks. Overseas demand, especially from the West Asian countries is also on a rise as supply from Guatemala, world’s largest producer of cardamom, dropped in the last few years, he said.

Cardamom production in Guatemala has been declining for the last five seasons as growers get no incentives on replanting and the revenue from the crop is low compared to substitute crops like coffee.

According to Spices Board, the shift from cardamom to coffee is quiet active in that country due to high prices of coffee. A couple of seasons ago, when prices went up, cardamom growers started planting again. But the new plantings will take three years to start producing in full. So India is now a major player in the global market, especially in West Asia since the last two years.

According to growers of Idukki, the market is poised for a better price realisation this season on good demand from the domestic as well as overseas markets due to various festival seasons and the coming winter season.

Exporters in Kochi said there is good demand from the Gulf region for the Ramzan season and prices are likely to rise further. Though the auction center is getting 10,000 kg on an average, the volume of fresh cardamom is limited to 1,500-2,000 kg. It will take three-four weeks for fresh arrivals to hit the market and would be strengthened by the next month.