Chilli may cost Rs100/kg on inclement weather

KOCHI: Red chillies could touch Rs100 per kg in the next few months as bad weather hits crop and delays harvest in Andhra Pradesh in a season of strong demand. Prices have risen by the maximum daily permissible increase in the past few days on NCDEX. February futures are ruling at Rs8,356 per quintal, up from Rs7,800 per quintal last week and Rs5,376 per quintal on December 1.

Spot prices too have touched Rs7,838 per quintal, up from Rs6,000-6,500 per quintal last year. “The way the chilli prices are going, spot prices may touch Rs10,000 per quintal and the futures Rs15,000 per quintal in a few months,” said Shailesh Shah, director of Jabs International.

Chilli harvest has begun in Karnataka and Indore. But the bulk of the crop comes from Guntur in Andhra Pradesh, where the harvest begins by January. This year, continuous rainfall has resulted in damage to the crop. AP Murugan, director of Paprika Oleos India, a leading exporter, says there could be up to 25% drop in production. The total chilli production last year was around 11 lakh tonne.

With a slight delay in the harvest of chilli, the carryover stock at Guntur storehouses is getting depleted as the domestic demand is strong. The present inventory is about 70,000 tonne and considering that the average monthly consumption is around 30,000 tonne, the current stock may last till the arrivals from the new crop are in full swing.

High prices have kept India out of the world market. Murugan said though the Chinese chilli crop was similar to last year, Beijing’s measures against inflation have brought down the prices by $1,000-2,000 per tonne, much below the Indian prices. “We are unable to quote as the prices are shooting up everyday. The rates are above $2,000 per tonne now,” he added.

Chilli exports had been doing well up to November. During the April to November period, chilli exports showed a 26% rise in quantity and a 22% increase in value at 1,66,000 tonne worth Rs1,020 crore. But December could be different.