Cumin (jeera) prices have rebounded by about 10 percent since the beginning of this month on demand re-emerging and lower ending stocks.
At the Unjha agricultural produce marketing committee (APMC) yard, a price setter in the spice, in Gujarat, cumin was quoted at $3,74 a kg, up from $3,43 on February 2.
On the National Commodities and Derivatives Exchange (NCDEX), cumin for delivery in April opened higher at $3,89 a kg on Monday against the weekend closing of $3,85 before surging to $3,99. It last traded at $3,95.
According to Geojit Commodity, dips in cumin to $3,77-3,72 is not ruled out, but the sentiments will strengthen if it rises directly above $3,88.
Down from peak at the start of the year
At the start of the year, cumin prices had topped $3,99 before declining on reports of the crop being higher at 4.14 million tonnes (mt) this year compared with 3.88 mt last year.
At the International Spices Conference in Chennai last month, a report prepared by ITC Ltd pegged cumin production, which dropped 20 percent last season to 3.88 mt, higher at 4.18 mt. It projected a rise in global production to 4.35 mt from 4.08 mt in view of higher Indian production.
Biplab Sharma, Senior Research Analyst, Agriwatch, told businessline that cumin production this year could be some 5 percent lower than last year as the crop was affected by adverse weather conditions, mainly rain in November.
High moisture in arrivals
Prices were down as the moisture of the new arrivals was higher between 15 percent and 22 percent. “In Unjha, the daily arrival was 4,000-6,000 bags daily but buyers are not active in view of high moisture,” he said.
Demand was expected to rise once the moisture of arrivals drop. “Cumin exports were lower by 22.77 per cent last year at 1.89 lt as high prices affected shipments,” Sharma said.
One factor for the spice’s outlook being bullish is that the ending stocks were lower, he said.
Boost from low stocks
ITC Ltd projected a higher production in view of the area under cumin increasing by 4.6 percent, mainly in Rajasthan where it increased by 13 percent. In Gujarat, the acreage dropped 10 percent this year.
As a result, net supplies from India are projected 7 percent lower which would drive prices higher, the report said.
Sharma said lower ending stocks will boost prices further
Source: The Hindu Business line
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