Omicron threat has started hitting the cardamom market with prices, according to traders, touching the rock bottom between ₹875 and ₹900 per kg. The southward movement has prompted the stakeholders in the sector to seek Spices Board intervention to discuss the price drop.

The Board is reported to have convened a meeting next week in Kochi with the stakeholders in the trade in view of the price drop for the commodity.

Besides Omicron sentiment, traders pointed out that apprehension of a further lockdown and the possibility of a business disruption, hesitancy in the upcountry markets to procure more quantities, subdued demand both in the domestic and overseas markets, excess production are contributing factors for the price drop.

The surge in production has resulted in increased arrivals in the auctions which are now in the range of 150 tonnes on a daily average. The farming community has urged the Spices Board to put a cap on offered quantities to arrest a further dip in prices.

Higher output

A trader at Vandanmedu in Idukki told BusinessLine that cardamom productivity has gone up considerably in the recent period with more small and marginal farmers taking up farming compared to high-end planters. The increase in area of production has led to more arrivals.

Instead of putting a cap on auction arrivals, the trader pointed out that the Spices Board should take steps to ensure price stability. This, he said, can be achieved by curbing exaggerated arrivals to the auction centres by streamlining the offered quantities. The Board should also take steps to increase the consumption both in domestic and overseas markets.

Likewise, there should be efforts on the part of officials to resolve the current bottlenecks in the exports of cardamom to Saudi Arabia, as the issues connected with minimum residue limits in pesticides to that country still continues. This would help fetch more export revenue, he added.

As per the current trend in the market, the present bulk is fetching ₹850-950, while 8 mm superior grades at ₹1,200 and 7 to 8 mm at ₹1,000-1,200. The rejection materials is quoting less than ₹700-800.

An auctioneer said that there was accumulated stock with traders following the last two lockdowns, which inflicted a heavy loss for the trading community due to trade disruptions. Some traders started holding the stock on the expectation of a price increase. The market was on a steady note till Diwali, later it started coming down in the wake of higher offer in the auctions, lower demand coupled with the panic situation due to the new Covid variant.

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