The aromatic journey of cumin takes a spicy turn as market dynamics create a rollercoaster ride for traders and exporters alike. Cumin faces a supply shortage this year, yet paradoxically, its market fate swings dramatically. The market sentiment experienced a significant downturn as the export price, initially at $7,23 per kg (€6,54), sharply declined to $4,82 (€4,36), sparking discussions about a potential economic downturn.
Ramzan Demand Gives A Silver Lining
Despite this turbulence, Ramzan demand has a silver lining, ushering in positive signals for cumin. A surge in export business to Gulf countries has been witnessed in the last 15 to 20 days. With Ramzan festivities beginning in March, the demand has kicked off early. Dubai traders, capitalizing on falling prices, are increasingly stocking cumin.
The demand is strong, but a potential stumbling block lies ahead. If the price inches up, it might deter demand, as Dubai traders could opt for lower-priced alternatives, causing a market standstill.
Regional Insights – Gujarat and Rajasthan Sowing Boom And Export Trends
The heart of cumin cultivation, Gujarat and Rajasthan, witnessed a two to two-and-a-half-fold increase in sowing compared to the previous year. Farmers, foreseeing a promising season, ramp up cumin cultivation. However, the sensitive nature of cumin crops hinges on the weather conditions in the next two months, adding an air of uncertainty.
Export dynamics paint an exciting picture. China jumped back into the market despite falling cumin prices, purchasing significant quantities. The anticipation of the Lunar New Year Festival in China signals moderate cumin purchases. However, the increased sowing in India is expected to balance out any substantial surge in demand.
Market trends showcase a recent resurgence in cumin exports, easing panic caused by delays in re-exporting containers from China and Syria. Domestic demand for cumin hinges on the fluctuations in futures prices. A bullish mentality prevails during price hikes, while a bearish sentiment emerges as prices decline.
Projections and Expectations
Market players speculate an increase of $0,24 (€ 0,22) per kg in cumin prices due to the onset of Ramzan demand. Additionally, expectations of a $0,12-0,18 (€0,11 – 0,16) per kg rise loom as export business gains momentum in China, Pakistan, and Gulf countries.
Insiders hint at potential export losses due to the current price scenario, forcing exporters to opt for purchases from NCDEX. Meanwhile, farmers report increased cumin sowing on the ground, attributing it to the optimistic outlook of fetching prices not less than $0,18 (0,16) per kg in the upcoming season.
The weather remains a wildcard, with the absence of adequate cold conditions in December impacting cumin crop growth. Delayed arrival of the new season and a probable reduction in crop yield compared to the previous year raise concerns. Gujarat’s cumin stock is expected to be minimal, with a delayed start predicted for the new season.
As cumin experiences a whirlwind of market trends, it’s evident that the spice is steering towards a flavorful season. While uncertainties persist, the early demand signals and export trends offer a glimmer of optimism. As a spice enthusiast guiding through the spice bazaar, one can’t help but savor the anticipation of the unfolding cumin trends.