Turmeric prices rise in India on fears of lower output
Turmeric prices in India have increased by Rs 200-300 a quintal (100 kg) in primary agricultural markets on pick up in demand and fears of lower production this year.
"Prices have increased in the last 2-3 days across all centres. In some places, prices are up as high as Rs 400. Demand usually picks up after January 15 and this increase can be related to it," said Erode Turmeric Merchants Association President RKV Ravishankar.
"Prices had bottomed out last year. They have gained now as turmeric production is expected to be 10 percent due to lower cultivation. Poor prices last year were a dampener on growers," said Amrutlal Kataria, a Nizamabad-based trader.
According to Ministry of Agriculture data, prices of finger variety turmeric almost touched Rs 6,000 on January 12 against Rs 5,640 a week ago at Erode in Tamil Nadu.
In Nizamabad, another major turmeric trade centre in Telangana State, the finger variety turmeric ruled at Rs 5,815 a quintal against Rs 5,532 a week ago.
On National Commodities and Derivatives Exchange (NCDEX), unpolished turmeric for delivery in April ruled at Rs 6,198 on January 13. According to NCDEX, spot prices have increased to Rs 5,725 from Rs 5,582 a week ago.
Last year during the same period, prices were a tad higher than Rs 6,000 a quintal.
Prices could have gained further but for the four percent ceiling on price movement on NCDEX, said Poonam Chand Gupta, another trader in Nizamabad.
"Speculators seem to be pushing prices up," said Ravishankar.
"Prices are gaining as there are fears that there could be as much as 25 percent crop loss in states such as Telangana and Andhra Pradesh. Even in Maharashtra's Sangli district, the crop has been affected," Gupta said.
Excess rainfall during October had affected the development of fruit in the three States, he said, adding that even in Tamil Nadu, another major producer, production was lower due to non-availability of farm labour in the aftermath of the novel Coronavirus pandemic.
Telangana is the largest turmeric producer, followed by Tamil Nadu and Andhra Pradesh with the three States accounting for nearly half the country's total production.
During the 2019-20 season (July-June), India's turmeric production was estimated at 9.46 lakh tonnes compared to 9.61 lakh tonnes the previous year, despite the area under the crop rising by 4,000 hectares to 2.57 lakh hectares.
According to Telangana Agricultural Department data, the average daily arrival of the finger variety turmeric is 86.7 tonnes this year against last year's daily arrivals of 73.7 tonnes in Nizamabad.
However, the average daily arrival of the bold variety turmeric is 19.75 tonnes this year versus 39.3 tonnes last year.
The turmeric crop has begun arriving in Telangana and Andhra Pradesh since last week, while it will start in other parts of the country in a month's time.
Exports have helped turmeric prices gain. "Exports have increased by nearly 40 per cent this fiscal. The market is good for exports," said Gupta from Nizamabad.
Gupta said that Indian turmeric was probably finding its way into Pakistan from Bangladesh in view of Islamabad banning imports from India following the Balakot air strike in 2019.
Ravishankar said it was likely given the fact that specifications for turmeric from Bangladesh was not much different from those for India. "Bangladesh imports of Indian turmeric have doubled," he said.
According to the Spices Board, Indian exported 99,500 tonnes of turmeric valued at Rs 8,581 crore during April-September 2020 against 69,500 tonnes worth Rs 6,338 crore during the same period previous fiscal.
According to Kataria, turmeric exports gained as its usage increased in view of Coronavirus pandemic. "People began using it more in their food to tackle COVID-19," he said.