Imports from Africa help tackle rally in ginger prices

Written by Rajesh Ravi | Kochi | Updated: Jun 26 2009, 05:59am hrs
Import of ginger from Ethiopia has helped in curbing a huge rally in ginger market due to the shortage of the commodity, traders said. In the month of April alone, the imports from the African nation crossed 1,000 tonne, sources said. Limited availability of ginger and the persistent demand from up-country would have taken the ginger price above Rs 200 per kg if not for the timely imports, P Nandakumar, a trade consultant from Kochi said.

Dry ginger is retailing at the level of Rs 125-130 per kg while fresh or vegetable ginger is selling around Rs 45 per kg. Conversion into dry is not feasible at the current level of fresh ginger prices. Demand for fresh ginger has increased compared to the past. Volume of fresh ginger transported to North India has increased dramatically, a trader from Wayanad said. Entry of big retailers and refrigeration facilities has meant increased demand for fresh ginger, he added.

Exports to Saudi Arabia are also likely to come down this year due to the prohibitive domestic prices, Ramalingam Vishwanath of GRK Traders told FE. Availability is low in India and the Indian pries are higher by 200-300% in the global market, he added. Exports from the nation are on a decline and Ramadan demand from Saudi Arabia is the only remaining export destination.

Until the end of 1980s majority of Indian ginger consignment (almost 30%) went to the West Asian countries. From 1990s India began to exports more ginger into its neighbouring countries like Bangladesh and Pakistan. The emergence of China in the global market has altered the dynamics of ginger trade as they manage to keep input cost low, traders said. Increasing production to offset the high prices are unlikely to take place in the short run, sources said. Higher input cost in the form of labour charges are plaguing the South Indian states.