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Fiery Chilli

posted Mar 4, 2011, 7:25 AM by NAVYUG Info
Delayed arrivals of the new crop of chillies along with apprehensions of a fall in production kept trend firm in the mandis, as Chilli shot up to its highest levels ever. As per some estimates the production this year is expected lower by 10-15 % at ~240-270 lakh bags (1 bag=40 kg) vs ~300 lakh bags production last year. Lower sowing activities have been reported in Andhra Pradesh where there are reports of farmers shifting to Kapas (Cotton) production. This had been due to the unseasonal rains in December last year which created apprehensions of crop damage and poor quality stocks. Lower stocks of ~12 lakh bags are supporting the rates further. Good export and stockists demand in the mandis firmed up prices further for Chilli. 

Unseasonal rains have also delayed the harvesting in some areas of the state by more than 15 days. It also adversely affected the crop productivity. In other states like Maharashtra and Madhya Pradesh also, similar reports of a fall in production have been there. 

Exports however remained firm thus creating further upside movement for the commodity rates. Latest reports from the Spice Board of India indicates, chilli exports were up by 22% rise in quantity to 2 lakh tonnes during April – January last year. 

There are expectations of firm in rates for Chilli to continue from a medium term point of view as a fall in production and rise in export and domestic demand are likely to support the rates. The prices have already touched new highs and any rise in exports could ensure rates to remain firm in coming weeks.