Cardamom prices in the country are seen weak and are under pressure on robust supply and sluggish demand, traders of the commodity have said. Reports of stricter inspection in Saudi Arabia due to fear of pesticide residue has also affected the market sentiments. Saudi Arabia is one of the biggest market for small cardamom from India, the second largest producer of cardamom in the world after Guatemala.
The average price stood at Rs 856.71 a kg on Tuesday at the auctions in Idukki where 81 tonne of cardamom arrived for trading against Rs 924.18 per kg reported on the same day last year. Auction prices have been consistent and good throughout the year with average price hovering around Rs 900-1,100 per kg. Cardamom prices had reached a record high of Rs 1,950-2,000 per kg during June 2010 due to shortage of the commodity in the country, the biggest consumer of the spice.
PC Punnose of Idukki based Cardamom Processing and Marketing Company (CPMC) feels that Indian supply has been increasing rapidly in the past few years due to good returns when compared to other crops.
“Market is surprised by the robust supply in these months which is considered off-season for cardamom. Supply of cardamom is now round-the-year and robust while consumption is seasonal,” he said. He estimates that cardamom market will be under pressure if the supply remains unabated when fresh arrivals resume in June-July.
Punnose estimates Indian production at around 30,000 tonne against the common trade perception of 15,000 tonne. State-run Spices Board data reveals that Indian production of small cardamom stood at 17,990 tonne from 69,357 hectares in 2016-17.
A total of 4,180 tonne of this spice, valued at Rs 456.01 crores, was exported during April-December 2017 as against 2,910 tonne worth Rs 297.80 crores during the corresponding period in 2016, registering an increase of 44% in volume and 53% in value.
Earlier, traders used to import cardamom from Guatemala when Indian prices moved up. Reports indicate that India used to import around 300-500 tonne of cardamom annually, which resulted in limiting domestic price.