For the first time after a gap of three years, cardamom prices hit a low of ₹930 per kg on Friday at the auctions held in Spices Park, Puttady in Kerala’s Idukki district.

Traders attributed the reason for the decline to the second wave of Covid-19 that kept away upcountry demand for the commodity in a big way. In August 2018, the prices have dropped to a range of ₹900-950.

The trading sessions at the auctions are also witnessing panic sales, resulting in the arrival of good quantities for offering. Both the trading sessions together are witnessing 100-120 tonnes offer on a daily basis, which is a huge volume in this off-season period.

A major cause

PC Punnoose, CEO, CPMCS, Kumily, told BusinessLine that the second Covid wave has hit cardamom demand in major upcountry markets. Besides exports, cardamom is mainly consumed in Delhi, Rajasthan, Madhya Pradesh and Uttar Pradesh. These States are the major trading centres and have been battered by the second wave of Covid. There is hardly any aggressive sales and liquidity for buying at these consuming centres. This has further affected the demand and also trade participation of buyers. Export demand has also started waning as the Ramadan procurement for major Gulf nations is over. Exporters were active in the market since January and they have already completed the purchase for their shipments for the occasion.

Summer rain to rescue

On the next crop season, Punnoose said it all depends on the summer rains. If the plantations receive good rains in May, the harvest will begin in July. The production is likely to be above average, as the sector is expecting a good crop in the current season. This is mainly because there is a good vegetative growth across plantations this year. The areas which are devastated in the two consecutive floods in 2018- 20 and the subsequent drought is expected to come to a full bloom in the current crop season, he said.