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Chilli Heat

posted Apr 25, 2010, 2:09 AM by Unknown user
With the India currency appreciating day by day, Indian exports is becoming uncompetitive especially the agri complex where prices are at highs as well. But one commodity has been finding good demand i.e. Red Chilli specifically from Bangladesh & China. 

In the first two weeks of April heavy demand of Chilli was seen from Bangladesh and around 5000T to 7000T of chilli were purchased by exporters during these two weeks. Also active were the stockist who were actively picking up good quality chilli to be stored in cold storages in Guntur and sold later at better prices. Both the demand from exporters and stockists ensured that the Chilli prices dint drop below the avg level (i.e. Rs44/kg for 334 variety and Rs. 56/kg for Teja variety) despite heavy arrivals of 1-2 lakhs bags (1bag = 40kgs) each day. However over the past week two new problems have arisen, first the availability of good quality chilli has decreased significantly and second the availability of trucks for transport has also decreased as transporters have diverted their trucks to Mango loading which yields better returns for them. Going forward the Chilli market looks neutral to bearish keeping in mind the slackening demand from exporters and stockists. But the transport situation may lead to some bullishness in overall export prices. After May 10 the cold storage materials will start to come out as fresh arrivals finish and the transport situation should also ease by then, at which point again better trade activity might be seen. 

Turmeric on the other hand have hardly fin any takers at the peaking rates. Rates of turmeric suddenly shot up in the beginning of the new season few weeks back, totally opposing the views of market fundamentals. There has been almost no shipment to Turmeric at such high rates and exporters and importers alike expected the price to reduce during second week of April. However, exporters in Mumbai had forward sold certain quantities to Dubai at around $2600 and were later compelled to purchase turmeric even at the higher rates, as the shipment periods were nearing. Also the arrivals in the local mandis are decreasing day by day and stockists are fairly active here too. These factors have for the moment provided some support to the high prices of Turmeric. Going forward, some correction is expected in the prices, but it would be minimal as there demand from Middle East and Bangladesh as well is showing increasing interest with each day passing.