Clove Market Analysis: Pressured Prices Amid Weak Demand and Currency Volatility

The clove market is currently facing a challenging phase, marked by a continued decline in prices and subdued buying interest on both the domestic and international fronts. Cloves are presently trading at $9.23 per kg at benchmark levels—a reduction of $0.12 per kg over recent days. This price drop is driven by weak global demand and increased volatility in the U.S. dollar, both of which are exerting further pressure on market sentiment.

Traders across key origins report sluggish sales, and unless demand revives significantly, a notable price rebound appears unlikely in the very short term. Despite this downturn, organic cloves from India remain competitively priced in the international market, suggesting potential for longer-term stability if macroeconomic conditions and import demand begin to recover. Overall, both exporters and traders are adopting a cautious approach while monitoring currency movements, weather impacts on new harvests, and evolving global demand patterns.

📈 Prices

Product	Origin	Location	Type	Current Price (EUR/kg)	Previous Price (EUR/kg)	Current Price (USD/kg)	Weekly Change (USD/kg)	Sentiment
Cloves (Whole, Organic)	India	New Delhi	FOB	9.55	9.55	9.23	-0.12	Bearish
Cloves (Ground, Organic)	India	New Delhi	FOB	9.65	9.65	≈9.34	–	Stable

🌍 Supply & Demand

• Demand: International demand remains weak, particularly from major importers in the Middle East and Europe, with buyers adopting a wait-and-see attitude amid global economic uncertainties.
• Supply: Key producing countries, including Indonesia, Madagascar, and India, are reporting steady supply flows. However, warehouse stocks remain sufficient, providing little upward pressure on prices.
• Currency Effects: Fluctuations in the U.S. dollar against local currencies have hampered export competitiveness, especially for Indian shippers.

📊 Fundamentals

• USDA & Export Reports: No fresh USDA data for cloves, but trade reports confirm lower shipment volumes compared to last year at this time.
• Global Inventories: Inventory levels in key markets are ample, with steady arrivals expected as harvest progresses in Indonesia and East Africa.
• Speculative Positioning: Traders and speculators are reducing exposure, waiting for clearer demand signals before re-entering the market.

🌦️ Weather Outlook

• Indonesia: Scattered rains in major producing regions are supporting crop development, with no immediate threats to bloom or harvest quality.
• India: Normal monsoon activity is promoting healthy clove crops in Kerala and Tamil Nadu, though excessive rain in some pockets warrants observation over the next harvest weeks.
• Madagascar & Tanzania: Near-average weather conditions, supporting a stable output forecast.

🌎 Global Production & Stocks Comparison

Country	Estimated 2024 Production (MT)	2023 Ending Stocks (MT)	Main Export Destinations
Indonesia	90,000	10,000	India, Middle East
Madagascar	20,000	4,000	Europe, USA
India	4,000	700	Domestic, Europe
Tanzania	8,500	1,200	Middle East, India

📆 Trading Outlook & Recommendations

• Downward price pressure is likely to persist over the next 3 days absent a revival in demand or significant USD weakening.
• Importers may consider staggered purchases as prices approach key technical supports.
• Exporters should monitor currency trends closely; a softer USD could provide some near-term relief.
• Speculative traders are advised to remain on the sidelines until clear buy signals or demand upticks appear.
• Closely watch weather updates in India and Indonesia for potential harvest surprises in the weeks ahead.

⏳ 3-Day Regional Price Forecast

Region/Exchange	Product	Spot Price (USD/kg)	3-Day Price Outlook
New Delhi (Benchmark)	Cloves (Whole, Organic)	9.23	8.95 – 9.20 (Bearish)
Madagascar FOB	Cloves (Whole)	9.05	8.90 – 9.10 (Stable/Bearish)
Indonesia FOB	Cloves (Whole)	9.15	8.95 – 9.20 (Bearish)