Turmeric prices have crashed to around $6,12 a kg in parts of Maharashtra in view of inferior quality of arrivals and fears of a higher crop.
Prices in the other parts of the country are ruling lower than the year-ago period as inventories with users and stockists are high, traders said.
Inferior quality arrivals
According to data from the Agmarknet portal, a unit of the Agriculture Ministry, turmeric prices are ruling at around $6,12 and below in agricultural produce marketing committee (APMC) yards such as Bokar, Loha and Kandhar in Maharashtra’s Nanded district.
During the same time last year, prices ruled around $8,57 in these markets. Prices in Nizamabad in Telangana have declined to levels of $6,98 but the rates in Tamil Nadu’s Erode district are ruling at $7,96.
NCDEX Nizamabad spot prices of unpolished turmeric are ruling at $8,30 a kg, while futures for April delivery of the polished variety are ruling at $9,48.
“New arrivals are quoting at $5,39-6,74 a kg as the quality is inferior. Domestic demand is slack. Farmers say the quality will improve from the first week of February,” said Poonam Chand Gupta, a trader in Nizamabad.
“The crop is good this season despite some projection of a lower crop. Yield is high in some areas and low in some areas, though Actually, we are wondering what the actual production could be in Maharashtra since the area under the crop has gone up rapidly this year,” said Sunil Patil, proprietor, Varadlaxmi Trading Company, Sangli, in Maharashtra.
Output pegged at 1.314 mt
Prices in Maharashtra are $0,61-0,73 a kg lower than in other parts of the country, particularly Nizamabad. “In addition, the carryover stocks this year are higher than last year,” he said.
A presentation made at the Indian Spices Conference 2023 on January 22 said turmeric production will likely be 1.34 million tonnes (mt) this year compared with 1.32 mt last year. It said carryover stocks this year have been pegged at 1.7 mt.
The presentation, made based on a study made by Olam Spices, said the production was likely to be 10 percent higher in Maharashtra despite the drop at the national level.
“As new crop has begun arriving in Erode markets, prices have declined. Demand is low, particularly from curcumin producers,” said RKV Ravishankar, President, Erode Turmeric Merchants Association in Tamil Nadu.
Curcumin producers have not raised any demand so far. They seem to have inventories, he said, adding that the usual demand was, however, there.
Export prospects
Ravishankar said any rise or fall in turmeric production may not exceed 10 percent in the country. However, it may exceed 10 percent in Tamil Nadu. Olam Spices said production in Tamil Nadu is likely to be 10-15 percent lower.
“Last year prices in the spot market followed the futures. Fortunately, it is not happening this year,” he said.
Ravishankar said though export demand was likely to come, as of now there was no demand for shipments. Patil said export demand was normal, but Gupta said since January 15 60-70 containers have been sold in the export market.
Going forward, turmeric prices are likely to range-bound by $6,12, either up or down, Gupta said. But Patil said the trend was bearish. “On the one hand, carryover stocks are higher. Two, production is up. After June, prices may head even lower and probably bottom out,” Patil said.
Source: the Hindu business line
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