Turmeric gets cheaper; traders left with huge stocks as sales fall

Harvesting of the new crop will begin by next week in Maharashtra, Telangana and Andhra Pradesh, said Rajesh Daliya, president of Nizamabad Merchants Association in Telangana.

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If the new crop being harvesTed is higher and demand is less then prices will fall by Rs 2-3 a kg, he said.
Turmeric, which saw soaring demand in recent months as people regarded it as an immunity booster, has seen become cheaper and sales have fallen and the new crop is likely to be 20% higher, leaving traders with huge stocks.

The December contract of turmeric on NCDEX had touched a high of Rs 6,170 per quintal of 100 kg each on October 21. On Thursday at 3 pm, the value of the contract was Rs 2,850 crore, which was down by 2.5% from the beginning of the contract in August.

Harvesting of the new crop will begin by next week in Maharashtra, Telangana and Andhra Pradesh, said Rajesh Daliya, president of Nizamabad Merchants Association in Telangana.


Prices are at a four week low and were 15% less than the previous year in the same time period at Rs 60-62 a kg. "We expect this year the crop to be 20% more than the previous year at 80 lakh bags of 70 kg each. Also, we have a carry forward stock of 35 lakh bag which has led to the drop in prices. We also are seeing a cash crunch situation in the market with traders and companies buying on need basis, " he said.

With drop in orders from Middle East, the US, Europe and Southeast Asia, prices have dropped by 10% to Rs 56-57 a kg in the futures market in the past one month and may further drop to Rs 52-55 a kg by December, said Subhranil Dey, senior research analyst, SMC Global Securities.

In August- September, there was good demand from the US, Europe , Middle East and South East Asian market, which dropped from October, said U Karthik, general secretary at Federation of India Spices Stakeholders. If the new crop being harvesTed is higher and demand is less then prices will fall by Rs 2-3 a kg, he said.
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"In domestic market, purchases have been made during festive season and we don't expect major buying, "he said.
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