Turmeric spot and futures prices have shot up sharply over the past one month, on reports of lower carryover stocks amid prospects of a lower crop in major turmeric-producing states. NCDEX April 2009 contracts increased by nearly 21% or Rs 818 to trade at Rs 4,726 per quintal on Monday over last month and May 2009 contracts also shot up by 17% or Rs 700 to trade at Rs 4,800 per quintal. Spot price of old crop at Nizam mandi was Rs 200 higher and traded at Rs 4,290 per quintal on Tuesday.
?Futures prices have jumped up by nearly 21% over last month on reports of lower carryover stocks at producing centres and lower revised estimate of turmeric crop for the 2009 season,? a local trader said. The new crop has now been estimated at around 42-43 lakh bags (each of 75 kg) from an initial estimate of 47-48 lakh bags, he said.
Revised estimates of turmeric production for 2009 have been further lowered to 43 lakh bags as compared to 45 lakh bags projected earlier in January 2009, according to latest estimate made by Angel Commodities.
?Farmers are hoarding stocks and not aggressively selling fresh turmeric. Carryover stocks are expected to be around 6-7 lakh bags,? an analyst with Angel Commodities said. Fresh arrivals are expected to improve in the coming days.
?Carryover stocks in February 2009 were reported at 5 lakh bags, which is quite less than that of 8 – 9 lakh bags recorded last year,? an analyst with Sharekhan said. ?Much in line with the bullish view, we held on turmeric since it was trading around Rs 3,900- Rs 4,000 per quintal. The commodity finally rose yesterday to close at Rs 4,700, near its last year high of Rs 5,100 per quintal. Fundamentals suggest that low international crop and almost same crop size this year (43-44 lakh bags) coupled with low carryover stock is bound to have its affect even in the coming months. Given the strong fundamentals, we maintain our bullish view on turmeric,? he said.