Traders expect the market to rally further with reports that the higher day time temperature and absence of summer rains could lead to damage of the crop.
Cardamom prices are on the rally and in the past few days have crossed Rs 1,500 per kg in the auctions conducted by the state-run Spices Board. Arrivals are on the lower side with the season nearing its end and the drought-like conditions in the area have added to the market sentiments.
Traders expect the market to rally further with reports that the higher day time temperature and absence of summer rains could lead to damage of the crop. India is the second-largest producer of cardamom in the world after Guatemala. The average price stood at Rs 1,510 a kg on Wednesday at the auctions in Idukki where 111 tonne came for trading. Cardamom prices had reached a record high of Rs 1,950-2,000 per kg during June 2010 due to a shortage of the commodity.
PC Punnose of Idukki-based Cardamom Processing and Marketing Company (CPMC) told FE that drought-like conditions and absence of summer rains do not augur well for the cardamom plants. “If we do not receive rains in the next one week, it could lead to cardamom plants withering away due to heat. Only 10-15% of the plantations have irrigation facilities and the ground water level in the district is also not good,” he added.
Arrivals to the auctions are also on the lower side and almost 50% down compared to February, Punnose said.
Kerala is the top contributor of cardamom to the country, having a share of around 70% in the total production, and Idukki accounting for the lion’s share.
Cardamom plants are very sensitive to rains with productivity directly related to the volume of rain and number of raining days. Cardamom needs low temperature, high humidity and incessant drizzle. Heavy rain could also damage the crop.