Cardamom prices have moved up because of delayed harvest in most parts and thin arrival of the new crop.
Traders said while the new crop has started trickling in, supply is very low to make a significant impact on prices. Most traders expect supplies to gain momentum after a month till that time the market could remain firm and move up a tad on the festival demand.
Most auctioneers have resumed their operation but are working on lower volumes ranging from 5-7 tonne.
?Supply lines are less than the normal and the market is reacting to it by firming up .We expect supplies to reach the average size of 40-50 tonne only by mid August,? PC Punnoose of Cardamom Processing Marketing Company (CPMC), Kumily, told FE.
CPMC resumed operations on July 11 but had to suspend it again for a week due to low arrivals. On July 21, they had 6.5 tonne as against 12 tonne during July 11. The average price per kilogram has climbed from Rs 1,570 to Rs 1,650 per kg on July 21, Punnoose added.
Ramadan demand from Saudi Arabia and other West Asian countries is further helping in improving the market, traders said. Interestingly, global shortages also lead to India capturing some lost exports markets.
Exports from India had declined due to premium on Indian cardamom compared to the Guatemala commodity. Indian lost traditional markets like Kuwait, Japan and Oman to Guatemala while retaining Saudi Arabia.
Cardamom farmers and traders have a feeling that the market may dip with increased arrivals at the auctions amid reports of a better than expected crop.
Punnoose adds that the crop may be normal but sustained and continuous rains in Idukki district could damage the crop which becomes prone to fungal attacks on more moisture. Cardamom needs low temperature, high humidity and incessant drizzles. Heavy rains could damage the crop, while intermittent rains that keep the atmosphere humid augurs well for the crop.