Futures prices of chilli are set to strengthen in the next couple of days on the back of depleting stock in warehouses of commodity exchanges. | |
| In the Guntur warehouses of National Commodity and Derivatives Exchange (NCDEX), the current chilli stock is "minuscule at 1,326 tonnes", according to commodity analysts and traders. |
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| "From the present trading levels for the June contract, the market can see a jump of around Rs 200 a quintal by the end of this month," said an analyst at Agriwatch Commodities. The June contract is trading at Rs 5,080 a quintal, which was Rs 4,800 a quintal until recently. |
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| The Guntur spot market closed today and will reopen in the first week of June. Sources said that operators could manipulate the futures market during this period, the impact of which is already being felt. However, analysts added that the commodity would see strong resistance at the Rs 5,300 a quintal level. |
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| The domestic output this year is estimated at 230 lakh bags (each of 40 kg). |
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| Cold storage houses in Andhra Pradesh have stocked about 70 lakh bags and are running out of capacity. "This is a huge stock," said Ashok Dattani, a Mumbai-based trader. |
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| He added that around 5-10 per cent of the total output might still be with farmers as the Guntur market witnessed arrivals of 35,000-40,000 bags on the closing day despite the season drawing to a close. |
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| Analysts said farmers who saw prices above Rs 6,000 a quintal over a month ago might be waiting for a similar uptrend. The spot prices in Guntur were in the range of Rs 3,200-4,200 a quintal last week. |
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| Overall, chilli is reeling under a sluggish demand in the domestic and the global markets. "We do not anticipate much demand from the northern part of the country at present," said Dattani. |
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| Market sources opined that the overall export demand had not been good except for a few phases. However, they expressed optimism of a revival in export demand once the market opened. |
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| Spot markets of Warangal and Khammam in Andhra Pradesh are also set to close soon. |
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