Jeera (cumin) prices, which have more than doubled since the beginning of the year, have topped ₹60,000 this week with the September contracts closing at ₹61,080 on Tuesday after rising to a high of ₹61,740 intra-day.

In the physical market, prices at the Unjha agricultural produce marketing committee (APMC) yard the modal price (the rate at which most trades took place) of the spice seed was ₹57,000 on Tuesday. It had surged to a high of ₹58,625 on July 6.

Anu V Pai, Commodity research analyst at Geojit Financial Services, said jeera prices have surged to record highs, breaching ₹60,000 and gained about 90 per cent so far this year on NCDEX. “Concerns over output amidst firm demand, especially export demand have bolstered jeera prices,” Pai said. 

“The jeera market is already saturated. That being said, the next crop is expected only in February-March 2024. Supplies are inadequate as only 70-72 lakh bags (50 kg each) are available against a total demand of 85 lakh bags, including exports,” said Erode-based Ankit Agarwal, Director, Amar Agarwal Foods India Pvt Ltd. 

According to Agriwatch, a firm sentiment is being witnessed in the jeera sport market as a 4.11 per cent lower production this year has resulted in lower supplies. “AgriWatch anticipated supply in the current marketing year is likely to go down by 13 per cent compared with last year, leading to lower ending stocks in the spot markets,” said Biplab Sarma, Senior Research Analyst - Commodities (Spices).

Unfavourable weather

The Geojit Financial Services analyst said unfavourable weather in the major jeera growing regions of Gujarat and Rajasthan in March-April this year affected output adversely.

Pai said while the Spices Board first advance estimates for the year 2022-23 shows a 12 per cent increase in production at 6,27,031 tonnes compared with 2021-22, market estimates show otherwise. “Traders estimate it to be 8-12 per cent lower at 6.5 million bags against the initial estimate of 7.5 million bags.  

In January at the International Spice Conference, jeera production, which dropped 20 per cent last season to 3.88 lt, was projected at 4.14 lt in the current season. As a result, global production was pegged higher at 4.35 lt against 4.08 lt. However, net supplies from India were projected 7 per cent lower and prices were expected to remain bullish, said a report prepared by ITC Ltd.

Unseasonal rains in March and heatwave in April affected the crop, particularly in Gujarat and Rajasthan thus aggravating the situation further. 

Geojit Financial said in a note that jeera production in Gujarat is estimated to drop by 9.3 per cent to 2 lakh tonnes. “The problem with supplies is that exports from Syria and China are not happening,” Agarwal said, adding that there was no bearish sentiment at all in jeera.

According to the Spices Board, jeera exports declined 14 per cent year-on-year to 1,86,509 tonnes last fiscal.

Despite the record high prices, Agarwal said his company was not asking its clients to stop purchasing the spice. “We expect prices to rally another 20-25 per cent and currently, traders are in a hand-to-mouth situation,” he said.

AgriWatch’s Sarma said buyers in the domestic market are expected to become active further as the next new crop will enter in the last week of February 2024 only. 

Agarwal said in view of the soaring prices, farmers could switch over to jeera from dhaniya (coriander) this year in Rajasthan. “That way, things look good for dhaniya,” he said.

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