According to the growers, clove had become another victim to the liberalisation of imports in agriculture produce in general and spices in particular, leading to the dumping of the commodity by rival producing nations. They said, up to 1993 clove fetched remunerative prices as the import of the commodity was restricted. However, the central government had eased the restrictions on clove imports on a phased manner since then leading to dumping of the commodity by rival producers.

Besides India, Indonesia, Madagascar and Sri Lanka are the major producers of clove. In India clove is grown mainly in parts of Kerala, Tamil Naduand Karnataka. While the production of clove was increasing at arithmetic proportion and the demand for the commodity has been going up in geometrical proportion leading to heavy demand-supply mismatch. Growers said the dumping of the commodity was mainly from Indonesia and Madagascar. The recent currency meltdown had provided teeth to Indonesian imports as the growers there could harvest rich dividend from exports than selling it in the domestic market.

However, Sri Lanka, like India had a well developed domestic market for the commodity leading to internal consumption of most of the domestic produce.Growers also felt that the central government had allowed clove imports without looking into the ground realities. They said, neither state governments nor the Spices Board had even the basic production data regarding the commodity. However, Spices Board said it was not mandatory for the board to collect data on clove as it does not come under its jurisdiction.

However, Sanjay Marivala, president of theInternational Pepper and Spices Trade Association (IPSTA), said the meltdown in prices was a natural correction as the prices were jacked up by a few traders in the past. "In the past, the entire clove trade was controlled by a few traders leading to artificial prices. Now with the liberalisation in imports, the scenario had changed and the `trade cartel' was losing its hold. This is good for both the consumers and traders in the long run," he added.

He said the current meltdown in prices was mainly on account of "speculation" by a few traders who resorted to heavy imports anticipating a peaking demand during the Deepavali season. However, the Deepavali demand turned out to be damp leading to stockpiling of the inventory. He added, "It is impossible for the prices to go back to the 1993-94 levels. Prices are likely to stabilise around Rs 60 per kg in the near future."