Coriander flares up 12% in futures market

MUMBAI | KOCHI: The common man has little respite from food prices, it seems. Coriander, used to flavour curries, has flared up by almost 12% on the futures market in the past seven trading sessions through Friday as traders wager that farmers will shift to more lucrative spices like cumin, chana and wheat, reducing the area under acreage. This in turn will push up prices of coriander.

In the past seven days through July 29, the near month futures contract (representing the wholesale price) spiked 11.6% to Rs8,526 a quintal (100 kg). The rise resulted from participants squaring off mostly bearish bets. The open interest (OI), or traders’ outstanding positions, declined from 20,360 tonnes to 15,530 tonnes over the same period. Rising prices accompanied by falling OI indicates short covering.

The top-10 clients on the buy and sell side of NCDEX held 33% of the marketwide positions, or 16,570 tonnes, in coriander, Bloomberg data shows. In the seven days through July 29, the top 10 shorts or bears cut their cumulative positions by 750 tonnes to 9,970 tonnes. However, other speculators who were short the commodity cut their bearish positions.

Spices traders in the spot market attribute the spurt in coriander prices despite a higher production to speculative activity in the market. At around Rs83 per kg in the spot market, the price is still lower than the rate a year ago when it went over Rs120 per kg.