What upset the growers in Tamil Nadu and Kerala was a reported reaction by National Multi-commodity Exchange of India Ltd (NMCEIL - the company running online futures in cardamom) that the stocks available were inferior quality. The farmer argument is that cardamom trading can only be visual since there are over 100 grades to be evaluated based on colour, odour, flavour, size, health and weight.
We not only have top-rated stocks this year, but are also expecting decent price-realisation, especially since the first Guatemala stocks that hit Gulf-market this month were rejected on low quality reasons P N Krishnan Kutty Nair, Vice-President, Cardamom Growers Association told FE. Every time that Guatemala or Zanzibar produces low quality cardamom, Indian cardamom has fared well in the market, some years ago fetching even Rs 800 per kilo.
But for the online futures trading giving misleading price information online, the growers would have got prices in the range of Rs 400-600 per kilo this season, according to the Association. Mr Sharad Pawar was convinced of the farmer distress through online futures and had promised to intervene after his visit to South India in mid-January. But then, there would be no cardamom stocks left in January for even making the best of a bad situation.
The cardamom season starts in September and ends in December. Contrary to an early report by Spices Board which predicted 5% increase in cardamom production, the stocks are actually short by 25%, say planters. A reported statement by NMCEIL regarding 40 quintal of old stocks in the market has further added to the confusion. It was a hoarding spree during a reverse situation of Rs 600-650 per kilo futures prices when spot prices was only Rs 400-450 per kilo that created this situation. Says K M Micheal, a leading cardamom planter, Prices quoted online for cardamom were as low as Rs 232 per kilo, while for even meeting the production costs one needs a price of Rs 360-400 per kilo. The entire issue hinges around misunderstanding cardamoms uniqueness as an auction-driven market, inelastic to online futures.