Tamarind prices tumble over expected bumper arrivals

Bangalore, Jan 2 | Updated: Jan 3 2006, 07:17am hrs
Aggressive competition from other Asian countries and expectation of bumper arrivals from new crop have led stockists to dispose the commodity stocked in cold storages, for rock bottom prices.

Currently, tamarind prices have declined by around 30-50% compared to the bumper price trend during the same period last year.

Early onset of South West and North East monsoon in 2005, surplus stocks in cold storage-warehouses in Andhra Pradesh, Tamil Nadu, Karnataka and Maharashtra and decline in exports are considered to be the main reasons for the price crash in the domestic market, trade sources said.

The current warehouse prices of tamarind hovers in the range of Rs 16,000 to Rs 20,000 per tonne for the fine quality seedless tamarind, down from the last years highest range of Rs 35,000 to Rs 45,000. The prices of tamarind with seed (second quality) also declined to between Rs 4,500 to Rs 7,000 per tonne from around Rs 12,000 a year ago.

Prices are expected to crash further by close to Rs 500 to Rs 1,000 per tonne from the current levels as the bumper arrivals are expected in the season starting from the end of February. In fact, the sudden spurt in prices and shortfall in arrivals had dragged down tamarind exports last year.

According to data released by the Indian Spice Board, the countrys tamarind exports declined to 7,500 tonnes in 2004-05 fiscal, from 12,077 tonnes a year ago and 12,590 in 2002-03. Anticipating continuous demand for the commodity, traders stocked large quantity of tamarind procured during earlier tamarind seasons, said M Inbasekar, a top South India based tamarind trader.

Warehouse charges account for 10% of the commodity cost. Most of the warehouses in Andhra Pradesh, Tamil Nadu and Maharashtra charge Rs 900 to Rs 1,000 to stock a tonne of tamarind per year. But due to widespread rainfall last year, the tamarind production is likely to grow outpacing domestic and international demand this year, which in turn would drag down the tamarind prices, Mr Inbasekar added. With this negative forecast and to avoid hefty warehouse charges, stockists are disposing their commodity at throwaway prices, he informed.