Supply crunch coupled with a surging demand — both from domestic and overseas markets — have pushed up nutmeg prices by about ₹40 to ₹590 a kg for ABCD grade (without shell). Nutmeg with shell is hovering in the range of ₹280-300.
Prices have started moving up on the rising demand from upcountry markets ahead of Diwali season. Nutmeg is a main ingredient in spices, perfume industry besides its medicinal values.
The export market has also been firm especially to China and West Asia for the usage of the product as an ingredient in immunity boosters. Traders felt that the pent-up demand is expected to continue for the time being.
Dwindling production
George Kuruvila, a nutmeg farmer-cum-industrialist in Vaikkom, focusing on value-addition, said lower production has lifted the market in the last few months. The consecutive floods in last two years and the climatic changes have affected the crop in Kerala, a major producer of the spice. The production plunged by 30 per cent last year to 10,000 tonnes.
Monsoon is the peak harvest time for Indian nutmeg, stretching up to August. But labour shortage due to the Covid-19 induced lockdown this year impacted normal harvest resulting in damage and decay and large scale falling of the spice. Hence the output this year is likely to remain flat, he said.
Consumption, imports
According to Anand Kishore, an exporter of nutmeg and mace, the total domestic production of nutmeg and mace (the red membrane) put together is at around 12,000 tonnes of which 30 per cent is empty shell weight and the balance is 8,500 tonnes. Of this, 7,500 tonnes constitute nutmeg; while the rest is mace.
Of the 7,500 tonnes of production, he said 3,500 tonnes goes for domestic consumption leaving 3,000 tonnes for exports and balance as carry forwards. The Indian consumption of mace, mainly used by the pharmaceutical industry, is estimated at 1,500 tonnes. It is priced at ₹1,800 per kg. India also imports mace from Sri Lanka and Indonesia to meet home consumption.
The rising demand for nutmeg, especially because of its medicinal property, has pushed up prices in the international market as well withSri Lankan and Indonesian produce fetching $8,000, he said.
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