Cumin prices have touched an unprecedented level of $4,83 a kg from $4,38 a kg logged in early this month on worries of crop damage due to unfavorable climatic conditions.
Cumin is one of the most widely used spices in Indian cuisine and is a major export commodity. India accounts for more than 70 percent of global production and trade. Jeera prices have soared to unprecedented levels due to a combination of factors that have adversely affected the crop.
One of the reasons for the price hike is the unfavorable weather conditions that have prevailed in the major jeera-growing states of Gujarat and Rajasthan since early March, said a Kedia Advisory report.
The prolonged dry spell followed by unseasonal rains and hailstorms has damaged the crop at various stages of growth and development, resulting in lower yields and poor quality, it added.
Estimate 70 million – Expected 50 million
According to market sources, the total size of the domestic cumin crop, which was estimated to be 70 million bags (3.85 million kg) at the beginning of the season, is now expected to be only about 50 million bags (or 2.75 million kg). This is a significant drop from last year’s output of 88 lakh bags (4.84 million kg).
The lower production has also affected the arrival of jeera in the physical markets. Normally, cumin arrivals peak in April, but this year, they have been very low and have declined by more than 50 percent compared to the same period last year.
The tight supply situation has created a strong demand for cumin from both domestic and export buyers, who are willing to pay higher prices to secure their stocks, it said.
The outlook for cumin prices remains bullish in the near term, as the demand-supply gap is likely to widen further. The domestic consumption of jeera is expected to increase during the upcoming festive season, while the export demand is also strong from countries such as China, Bangladesh, Sri Lanka, and the Middle East.
Moreover, the global supply of cumin is also limited, as other major producers like Syria and Turkey have also faced crop losses due to political unrest and weather issues. Therefore, jeera prices may continue to rise until the next crop arrives in February-March next year, said the report.
The Cumin seeds grade A prices were Recorded at $5,20 per kg FOB.
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