Why Clove Prices Are Expected to Rise?

While the clove crop arrival is delayed by 10-12 days, the Komran Zanzibar harvest was sold in October-November, resulting in increased international market prices. Despite goods from Madagascar having a high price point, they continue to maintain their value, indicating that cloves may see an additional rise.

Current Scenario

Sri Lanka’s clove production, which began in January, has faced a reduction in supply due to defective poles in its crop, with producers dealing with slow-running conditions in previous years. Madagascar is scheduled to import new cloves this month, as old goods have seen price hikes of $100-$110 per tonne each for a month. A lack of rupees in the markets has resulted in scarcity driving up prices.

Madagascar, Indonesia, and Zanzibar currently have less stock, leading to a recent increase in cost per tonne of $70-$80. Despite declining stock levels, the cost of long goods has continued to rise, with a 15-day interval.

Future Scenario

Sri Lanka’s economic issues have weakened trade, discouraging importing countries. Furthermore, running into losses in the past three years has reduced the business of cloves, with traders selling their old cloves due to a backlog of supply. Importers are quoting inflated prices, resulting in further progression of price fluctuations.

All things considered, current market trends indicate a potential price jump for cloves in the coming months. Colombo’s goods are facing supply chain delays due to import costs. Thus, to wind-up the future price of cloves is expected to rise due to market trends caused by recent crop polls.

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