Cardamom prices are on an upswing with arrivals still low at the auction centres.
Demand from the upcountry market has led to a firmer market and auction prices are up by 15-20% compared to the same period last year, traders said.
Demand from West Asia also picks up during the Ramzan festival and is likely to make the market firmer.
According to figures made available by the auction centres, as on September 26, the total arrivals from August 1 stood at 765 tonne as against 1,394 tonne in the same period last year.
Fundamentals of Cardamom are strong and export demand will be the key price driver for the commodity, Faiyaz Hudani, Research Analyst at Kotak Commodity Services Ltd said.
?Total production in the this season is expected to be 25% lower at 8,500-8700 tonne, compared to 11,000 tonne last year,? he said. Incessant rains in the cardamom growing areas in Kerala?s Idukki district have led to widespread fungus disease in the plants, which might result in further drop in the late crop, he added. Stocks in the exchange warehouses are around 67 tonne.
?We see a strong support at Rs 480 on the downside and a strong resistance at Rs 574-621 on the up side. A breakout above Rs 621 will lead to a new rally,? Faiyaz said.
Exports of the commodity have not picked up to the desired levels, but the unit realisation from exports has registered impressive growth.
Export of cardamom (small) for the first five months of the FY has dipped by 24% while the price has increased by 7% compared to the same period last year.
For cardamom (large), the quantity has shown an increase of 68% and the value has increased by 67% compared to the same period last year.