Cardamom growers are concerned over decline in the prices during the lean production period after the main season. The prices, which have been free from much fluctuation over a period of three years, declined after ruling at a high level, though the overall production has not been increased, but remained at same level as that of the previous season.
The average prices per kilogram of cardamom at the auction centres were remaining slight below Rs 1,000 which had remained Rs 1,600 before the slump for a period of over a month. The main reason is attributed as the overstock of the producers and businessmen on the expectation of reaching the prices to Rs 2,000 level and the jump in the arrival of cardamom when the prices started a minor decline at the auction centres.
During the lean season, instead of a declining trend in the arrival of cardamom, it showed an increasing trend, said an official at the auction centre.
One of the main reasons for the decline in the prices is the sudden fall in the export ending the last production season as compared to the previous season. The export fell from 1,500 tonne in the previous financial year to a mere 500 tonne in the current financial year.
The main market of the Indian cardamom is the Gulf countries and Guatemala, the main exporter of cardamom, retained its marketing which was affected due to a sudden fall in the production and internal disturbances in that country.
Though the export of the Indian cardamom is only a ten percent of the total production, the internal market had been a major boost for the prices. ``The decline in export cannot be termed a reason for the decline in the prices, but the high level of market arrival during the off-season is the main reason for the fall in prices,'' said Cardamom Growers Association executive secretary K.K.Devasia. He said that internal demand for value-added products has been on a steady growth and there is no reason for fall in the price to the bottom level, though minor fluctuations are expected.
After the introduction of e-auction, there has been a transparency avoiding the chances of traders forming a cartel to reduce the prices.
He said that the increase on the supply side especially during the lean season might have resulted in the prices falling and it is only a temporary phenomenon, though the prices cannot be expected to hit the roof as Guatemala has been on retaining the exporting market.
