Indian Chillies : A Big Slack Foreseen

Mintec Global
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The trade activities of red chilies have started slowing down in the major producing states like Andhra Pradesh and Telangana. Traders said that the buying of exporters have slowed down due to the quality of red chilies at present is quite lower than normal and the price being comparatively high. Along with this, the new crop of Madhya Pradesh coming next month is also affecting the market sentiments.

Due to the sluggish business activities in the local wholesale grocery market, red chilies remained at the previous level. Recently there was a recession of 10 percent in it.

Traders said that due to the news of sluggishness from major producing states and the new crop arriving in Madhya Pradesh after about a month, an atmosphere of sluggishness is being created in this major domestic markets. Mr. Jugraj Bhandari, a trader based in Guntur Mandi of Andhra Pradesh, said that after the recent recession, farmers have also limited the sale of their red chili crop stock. This is the reason that the arrival of red chilies in the market has come down to about 30-35 thousand sacks as compared to the earlier level of 40-45 thousand sacks. Surprisingly, after this arrivals decreased, instead of hiking, the market is slow. Experts state market can further go down around 5 to 10% from these levels.

Sources state that, the farmers have got an attractive price of red chilies for the second consecutive season. Therefore, it was believed by experts that this time there may be bumper sowing of red chili in the state, but from the indications received so far, it seems that in the current season, red chili has been sown in the state same like the last season. Along with this, due to the timely onset of monsoon rains during the current season, the new crop of this major spice is expected to get benefit. The prices in the domestic markets are constantly higher than normal.

At present market price has had a negative impact on its exports. However, according to the available data of the Spices Board of the April-July period of the current financial year 2022-23, 1,42,957 tonnes of red chilies worth $2,29 billion have been exported from the country. It had exported 1,76,779 tonnes in the year-ago period and earned an income of $3 billion. This clearly shows that this time there has been a decline of 19 percent in the export of red chilies in terms of quantity.

The new red chili crop is expected to start in Madhya Pradesh during the first week of October. Monsoon rains have been very high this time in different areas of Madhya Pradesh. Due to this, it seems that this time the production of red chilies in Madhya Pradesh may decrease somewhat. Though the scenario of production is not completely clear yet, due to this the wholesale trading activities of red chilies in major mandis of Andhra Pradesh and Telangana have slowed down. In the coming days, the rapid slowdown of red chili is expected depending upon the potential production of the upcoming crop of Madhya Pradesh.

The Chilli dried long red stemless prices were Recorded at $2,65 per kg FOB.