Futures and spot prices of turmeric on the national bourses may continue to remain weak over next few days in anticipation that the production of turmeric in the coming season would be better due to early onset of monsoon.
Last week, turmeric June contracts on the National Commodity & Derivatives Exchange (NCDEX) fell sharply by nearly Rs 590 per quintal or 11% to trade at Rs 4,927 per quintal on Monday over the last week on some profit-taking on reports of weak overseas demand and rise acreage in coming season in Andhra Pradesh.
?Turmeric prices went down by near 4% over past few days extending the losses on weak demand and rise acreage in coming season led the traders to book profits and come out of their long positions,? Anand James, senior analyst, Geojit Comtrade said.
Early onset of the monsoon may induce farmers to go for sowing of turmeric. Sowing of turmeric is expected to increase as they earned better prices in the current year, he added.
Spot prices at the Nizambad mandi also declined by Rs 250 per quintal on scattered buying interest from local buyers. However, spot markets at Nizamabad and Erode remained closed on Saturday due to weekly off. Price gap between spot and futures markets has widened to over Rs 300 per quintal, trade sources said.
?In the long term, prices may take cues from the availability of turmeric in 2009 and demand from the domestic as well as overseas market,? Nalini Rao, analyst with Angel Commodities said.
Physical stocks with the farmers and stockists are at lower levels which include Nizamabad-4 lakh bags, Erode-8 lakh bags, Sangli and Duggiralla-1.5lakh bags each and Warrangal-1 lakh bag.
?Sowing of turmeric is expected to grow in Nizamabad and Erode by around 20% and 40% respectively. Sowing commences with the onset of monsoon in the month of June. Demand from the domestic and overseas market is present in small quantity due to appreciation in rupee and subsequent decline in overseas orders,? she said.