Turmeric futures soar past ₹10,000 a quintal on supply concerns

Riding high on the fall in kharif sowing acreage, turmeric prices on NCDEX crossed ₹10,000 a quintal-mark for the first time since last February. It is anticipated that the Kharif sowing acreage of turmeric will decrease by 20-25 percent this season.

Business 01 Jul 2023  The Hindu

Turmeric futures contract for October delivery on the exchange jumped four per cent to ₹10,326 a quintal on Friday. Given the tight supply situation, the October contract had jumped almost 60 per cent in two months from low of ₹6,452 a quintal. The near month August contract also joined the rally to gain four per cent to ₹9,862 on Friday.

Beside lower acreage, the turmeric market has experienced a significant price rally driven by fear of crop damage caused by recent rains in Maharashtra and Andhra Pradesh. This triggered concern on potential decrease in yield and resulted in turmeric prices surging over seven per cent in a week and reached their highest level in five months. This apart, concerns on poor rainfall due to the threat of El Nino also added to the bullish sentiment in the market.

Ajay Kumar, Director, Kedia Commodities, said sowing of turmeric has been delayed by 15-20 days as farmers in key growing States are eagerly waiting for monsoon showers.

It is anticipated that the kharif sowing acreage of turmeric will decrease by 20-25 per cent this season as farmers opt for other crops which will further tighten turmeric supply leading to further uptick in prices, he said.

Turmeric sowing acreage in Maharashtra, Tamil Nadu, Andhra Pradesh and Telangana is projected to decline by 10-25 per cent compared to the previous season. Additionally, untimely rains in various places in Andhra Pradesh have caused damage to turmeric crops, leading to supply disruptions.

Exporters have started buying better quality turmeric due on fears of unavailability in the future.The overall outlook for turmeric prices remains bullish due to the expected weakness in monsoon rains and the anticipated decrease in acreage, which will likely impact turmeric production, he said.

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