Recent rains in Maharashtra have cast a vibrant hue on the turmeric market, as concerns over a potential decrease in yield have driven prices up by nearly 12 percent in the past 20 days. Futures market prices have soared to their highest level in five months, with speculators signaling further growth in the turmeric sector.
The Marathwada region of Maharashtra experienced substantial crop damage due to last month’s rainfall, leading to anticipated yield reduction. Unseasonal rains in various parts of Andhra Pradesh have also impacted the turmeric crop, resulting in rain-soaked stocks in Guntur, Krishna, and NTR districts.
Although the arrival of the new crop has improved, with approximately 7-8 million bags reaching Nizamabad and about 7 million bags arriving in Sangli, there is currently no shortage of stock in the market. Farmers and small traders are offloading their goods to capitalize on the high prices. Stockists are eager to release their holdings with each price increase. According to the Spices Board, turmeric production in the country is estimated to reach 1.33 million tonnes this year, an 18.4 per cent increase from the previous year.
Surging turmeric prices
This marks the fourth consecutive week of surging turmeric prices, reaching a pinnacle unseen in over five months. The sudden price surge can be attributed to speculators seizing opportunities in the market following reports of crop damage due to recent rainfall. A lack of supply at important trading centers has propelled turmeric (June) futures to a five-month high. The decline in arrivals, fueled by reports of crop damage in Maharashtra, has supported the rising prices.
Turmeric is expected to continue its upward trajectory amidst concerns over supply. However, supply conditions have improved in Telangana and Maharashtra as farmers release their stocks in response to favourable prices. On the other hand, export demand has waned following the price hike.
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