Jeera finds support from export mkt as India becomes cheapest origin

Written by RajeshRavi | Kochi | Updated: May 15 2012, 07:27am hrs
Jeera is finding support from the export market as India becomes the cheapest origin for the commodity. Market prices have bounced back from the lows and seem to be finding support from the robust consumption. Reports of lower sowing in competing origins are also giving support to the market.

There is a pull back rally in jeera due to good demand. Exports are also very good at the moment, Faiyaz Hudani at Kotak Commodity Services said. Jeera exports during the first ten months of the last FY stands at 34,500 tonne, which shows an increase of 54 % over the same period of the previous FY. Historical data shows that domestic prices are correlated to exports. Higher exports have translated into firmer domestic market.

Jeera will bounce back after a small correction. Prices have improved due to good export demand and this may prompt farmers to bring more commodity into the market, Nalini Rao of Angel Commodities told FE. Jeera prices have declined from R17,000 per quintal in January 2012 to R12,500-13,500 per quintal level due to extremely good production, she said. At this price, the demand is robust and exports are increasing. This may support the market despite good arrivals, she added. Spot price for jeera at Unjha on Monday stood at R13,647.50 per quintal.

A sudden drop in jeera production in Syria and Turkey had helped India achieve impressive exports figures from 2007, a Spices Board official said. Production dropped by 500-600% in Turkey during 2007 due to erratic climate. It has improved slightly now but is seen much lower that the normal output, sources said.

Kotak reports that jeera sowing in Syria has been reported less around 30%. In Syria there is shortage of laborers and due to unfavorable weather conditions jeera production is expected not more than 50%. Jeera seed production in Turkey will be around 60% of last years production, Faiyaz Hudani said.

Besides India, jeera is cultivated in Iran, Turkey and in Syria mainly for exports. The new crop in Syria and Turkey is harvested in AugustSeptember, so until then, Indian jeera will find good market in overseas countries. The harvest period in India for jeera starts around February-March. The country is the worlds largest producer and consumer of jeera. While India consumes 75-80% of the commodity produced, the other producing countries export most of the product.