The Causes of Recent Price Surge and Market Fluctuations
Anticipated to Stay Strong: In recent days, the market for Big Cardamom has experienced significant fluctuations. Initially, there was a surge in prices due to concerns over production levels being considerably lower than usual. This uptrend was followed by a phase of profit-booking. The import prices from Nepal also remain elevated. Looking ahead, Big Cardamom is expected to maintain its strength in the market. The nominal production of the second crop of Big Cardamom in major producing states is attributed to adverse weather conditions during its growth phase. Both the first and the expected second crops are projected to be weaker than normal.
During the cultivation period, the major producing states reported temperatures above the average, coupled with pest infestations on the crops. This has led to a potential loss of up to 70% in the first harvest of Big Cardamom. The second crop is also anticipated to be below par. Despite this, recent weak procurement has caused a significant increase in prices in the local wholesale grocery market. The price of Cardamom Jhundiwali recently escalated by, reaching a peak of $15,72/$15,84 (€14,31/€14,42) per kilogram. Following this, due to profit-booking, the price stabilized at $15,00/$15,12 (€13,75/€13,87) per kilogram.
Global Implications: Export Performance Crop Damage in Nepal, Bhutan, and Sikkim
Crop Production and Environmental Challenges: Like in India, Big Cardamom crops in Nepal have also suffered damage. Current reports from Nepal indicate the arrival of 500 to 1,000 bags of cardamom, with the import price currently around $14,40 (€13,20) per kg. This price is above the usual rate and is expected to rise further. Additionally, there are reports of crop damage in Bhutan and Sikkim, suggesting a looming scarcity of cardamom in domestic markets, potentially increasing demand pressure this month.
Comparing Current and Previous Financial Year Performance
For the financial year 2023-24, India exported 458.15 tonnes of Big Cardamom worth $4,65 million (€4,25 million) in the first seven months (April-October). This compares to 912.29 tonnes exported in the previous year, generating a revenue of $9,07 million (€8,28 million). Given these circumstances, Big Cardamom prices in India are likely to remain robust in the near future.
In conclusion, despite facing environmental challenges and market volatility, the Big Cardamom market is expected to remain robust due to reduced supply and sustained demand.