Chilli Market Update: Favorable Weather Stabilizes Prices, Production Prospects Improve

The Indian chilli market is currently experiencing a period of stability and cautious optimism, driven by notable improvements in weather conditions across major producing regions, particularly in Saurashtra. Key districts—including Junagadh, Bhavnagar, Rajkot, Amreli, and Jamnagar—have reported timely rainfall that restored soil moisture, alleviating concerns about earlier moisture stress and supporting healthy plant development. This turnaround has revived production sentiment among both farmers and traders, who now expect output to potentially exceed prior projections if favorable weather persists.

Stable prices in local markets reflect a delicate equilibrium between revived crop prospects and consistent demand. If these positive trends hold and no new weather disruptions occur, experts and market participants anticipate a steady pricing environment through the coming weeks. This prevailing outlook contrasts with volatility seen in prior years when crop failures or erratic rainfall drove sharp price swings. Both fundamental data and current trader sentiment suggest a reliable supply pipeline and limited near-term risk of price shocks—giving buyers and sellers alike improved visibility for the upcoming trading sessions.

📈 Prices

Product	Type	Origin	Location	Currency	Latest Price	Last Price	Weekly Change	Market Sentiment
Chilli dried whole	Bird eye, Grade A, Organic	IN	New Delhi	EUR	4.68	4.71	-0.03	Stable
Chilli dried powder	Powder, Grade A, Organic	IN	Andhra Pradesh	EUR	4.42	4.45	-0.03	Stable
Chilli dried flakes	Flakes, Grade A, Organic	IN	Andhra Pradesh	EUR	4.39	4.42	-0.03	Stable
Chilli dried with stem	With Stem, Conventional	IN	Andhra Pradesh	EUR	2.18	2.21	-0.03	Stable
Chilli dried whole stemless	Whole, Stemless, Grade A, Conventional	IN	Andhra Pradesh	EUR	2.21	2.24	-0.03	Stable

🌍 Supply & Demand Drivers

• Recent rainfall in Saurashtra and southern India has significantly improved crop outlooks, reviving moisture-deficient fields and stabilizing plant health.
• Current production expectations are stronger than the previous season due to timely weather support.
• Demand remains steady in both domestic and export markets, with buyers showing preference for high-grade, organically certified varieties.
• Traders are not reporting significant speculative activity or inventory build-up, suggesting balanced short-term supply.

📊 Fundamentals & Market Drivers

• Crop Condition: Improved, with field observations and soil analyses indicating healthy growth stages in major producing regions—particularly in Gujarat and Andhra Pradesh.
• Speculative Positioning: Market participants are largely neutral, with no excessive forward bookings seen at present.
• Inventories: Ending stocks remain comfortable across most terminals, limiting upward price pressure.
• Comparative Note: Compared to the last reported season (2024), prices are showing less volatility, attributed to back-to-back favorable monsoon cycles and smooth logistics.

🌦️ Weather Outlook & Yield Impact

• Saurashtra & Gujarat: Continuing mild, well-distributed rainfall is forecast for the next week. Daytime temperatures are moderate (28-32°C), with low risk of heat stress—a positive for chilli pod development.
• Andhra Pradesh & Telangana: Expect partly cloudy conditions, sporadic showers, and generally benign weather; ideal for crop maturation and harvesting in late-stage plantings.
• Potential Risks: Unexpected heavy rainfall or local flooding could impact picking activities; currently assessed as low probability.

🌐 Global Production & Stock Comparison

Country	2024 Output (Est. ‘000 MT)	2023 Output (Est. ‘000 MT)	Ending Stocks (Est. ‘000 MT)
India	2,100	2,000	220
China	1,880	1,860	180
Bangladesh	160	150	20
Pakistan	135	125	15
Vietnam	95	90	10

📆 Trading Outlook & Recommendations

• Maintain coverage at current levels; prices likely to hold steady barring unforeseen weather events.
• Short-term buyers may find attractive entry points as volatility remains subdued.
• Exporters should monitor currency fluctuations; INR/EUR stability is a supportive factor for international sales.
• Monitor local weather alerts, particularly approaching monsoon surges in September, for any early signs of harvest delays or logistical disruptions.
• Stockists can defer aggressive purchases until there is clearer directional movement on demand.

⏳ 3-Day Regional Price Forecast

Product	Exchange/Market	Today	Day 2	Day 3	Trend
Chilli dried whole	New Delhi	4.68 EUR	4.68 EUR	4.67 EUR	Stable/Soft
Chilli dried powder	Andhra Pradesh	4.42 EUR	4.42 EUR	4.41 EUR	Stable/Soft
Chilli dried flakes	Andhra Pradesh	4.39 EUR	4.39 EUR	4.38 EUR	Stable/Soft