Spice market update: trade in India comes to standstill
March 26, 2020 at 4:40 PM ,
Der AUDITOR
Throughout India, there are no trading activities in the spice markets. Since this week there is a curfew in the whole country, production and exports came to a complete standstill.
Cumin
Due to the good monsoon rains there are favourable climatic conditions and a high availability of water, which supports the expectation of a very good crop. Farmers in Rajasthan and Gujarat expect up to 30% higher crop yield compared to last season. This hope was dampened by a locust infestation in Rajasthan, which, however, caused less damage than initially feared. The production estimates for 2020 amount to 535,500 metric tonnes.
Exports have already been sluggish in recent months, as India ships more than a third of its cumin exports to China, which stopped imports at the beginning of the year due to the outbreak of the coronavirus. Indian traders had initially expected to sell 50,000 metric tonnes of cumin to China this season. India is the only country from which China sources its cumin. Now there is hope that the demand for exports will increase again once the situation around the coronavirus has calmed down. Between April and December 2019, India exported a total of 162,094 metric tonnes of cumin. Prices for grade A cumin are 1,720 EUR per metric tonne FOB.
Coriander seeds
The coriander market was already in a pessimistic mood before the problems caused by the Covid-19 pandemic. Although the acreage has been reduced by about 11,000 ha compared to last year and therefore, there are correspondingly less goods available, producers are not satisfied with farmgate prices. This is largely due to the fact that the national agricultural market in India is currently in recession, as market players report. The prices are set rather low. Ultimately, this means losses for the farmers, which cannot be offset even by the promised government subsidies.
The sowing has been late due to heavy rainfall, but the producers still report a good crop with a high quality. Traders therefore expect good prices as soon as the situation on the world markets returns to more or less normal. Coriander, Eagle, 5% split costs 696 EUR per metric tonne FOB this week.
Turmeric
Due to heavy rainfall, market players expect crop losses of about 25%, current crop estimates amount to 913,000 metric tonnes. Turmeric prices have been falling steadily in recent weeks and the farmers' plea to the state and central governments to get help through a minimum support price fell on deaf ears.
Exports were also rather sluggish, partly due to the US sanctions against Iran. Iran is the main export destination for Indian turmeric. Since relatively few goods are shipped to China, the outbreak of the coronavirus initially had little impact here; due to the complete shutdown of the country, the situation is now different. Current prices for turmeric, salem, double polished are quoted at 828 EUR per metric tonne FOB.
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