Local demand lifts red chilli prices 40%

Local demand and thinning stocks have driven red chilli prices to a new high. Premium chilli variety teja is currently selling at ₹195 per kg, up almost 40 per cent from a year ago. Earlier during this financial year, prices went up because of increasing exports. Now, while the stock of export quality premium chilli has depleted, average quality chilli, which sells at a lower price, is finding good demand in the domestic market.


“Local sales are doing well, while exporters seem to be waiting for the new crop,’’ said L Selvadurai, proprietor of Southern Agro. Cold storages are running low on teja stock but there is good supply of the sannam variety, which is sold in the local market, he said. The industry expects prices to come down only after the second week of December when the new harvest begins in the southern districts of AP, Telangana and Karnataka, the main producers. Chilli exports from India were robust till prices reached ₹170 per kg.


“India is the sole supplier of chilli in the global market and hence many countries were buying even when prices rose from last year’s level. Even now there are some shipments,’’ said Shailesh Shah, director of Jabs International. Chilli production season began with MP, where the crop harvested this month was below expectations. “Around 25 per cent of the crop was damaged in incessant rain,’’ said Selvadurai. This was a factor in the surge in chilli prices.

But it is likely to be compensated by the bumper crop expected from the southern states. Selvadurai said high prices have compelled new farmers to take up chilli sowing. This may take the total output past previous year’s harvest of 2.3 MT.

The industry expects exports to go up by the middle of January, when chilli arrivals in markets are in full swing.