Cardamom prices are under pressure in the domestic market due to reports of a bumper crop. Extremely conducive climate, with good summer rains and relatively less temperature during April-May period, is likely to take cardamom production to above 20,000 tonnes in India.India is the second largest producer of cardamom in the world after Guatemala and the biggest consumer of the spice. Guatemala leads with 60-66% of the world production but has seen production come down in the past few years due to natural disasters like flood.
“Farmers are worried that the market could go down due to good production. But higher exports could support the market.Strong winds in the past few days have also damaged some plantations in Idukki,” PC Punnose of Cardamom Processing Marketing Company, Kumily, told FE. Cardamom plants are very sensitive to rains with productivity directly related to the volume of rains and number of raining days. Cardamom needs low temperature, high humidity and incessant drizzles. Heavy rains could damage the crop, while intermittent rains that keep the atmosphere humid augur well.
Cardamom fetched an average of R698.53 per kg on Friday’s auction in which 19 tonnes were traded. “Cardamom futures are expected to trade with a negative bias due to higher production estimates and better arrivals in major spot markets. Demand for spice in the spot market is sluggish on lack of availability of exportable quality,” V Vijayakumar, research analyst at Geofin Comtrade said. “Meanwhile, prospects of rise in demand and as well lower crop estimate in Guatemala current year limit fall in the prices. Inferior quality concern for Guatemala cardamom also added to the sentiment ,” she added.
Geofin report on the commodity says the total crop of cardamom for Guatemala for the 2014-2015 is expected to be 29,000 to 30,000 tonnes, about 8,000 tonnes less than last season. India imports 300-500 tonne of cardamom annually, which helps in limiting the domestic price.