Market Report – January 2022
Chilli / Capsicum
Chilli producing regions in Karnataka, Andhra Pradesh and Telangana states have experienced a Western black flower thrips attack over chilli farms in the main growing regions and the crop damage is estimated to be very severe. The available pesticides and chemicals are not very effective against these pests and hence it would affect the yields of the standing crop.
Prices for Chillies continues to be very high. Rates moved up almost 25% over last two weeks. Chilly crop was expected to be very good this year initially, due to higher sowing, on account of high prices last year. Overall estimates ranged from 30-50% increase in different states. Many major farmers also switched crop from others to chilly, due to attractive prices.
May be due to unusual warm and wet weather, due to the rains. By the time the damage was detected, in few days, it has multiplied many folds and it also attracted viruses, which has damaged the plants. Initially it looked like a localized damage to certain regions. But this issue has spread to multiple regions in AP & Telangana states. The damage caused is extensive and finding a solution has also been a major issue overall, though there are certain approaches suggested as of now. To protect the crop, in panic, farmers will use any measure necessary. We will have a clear situation in end January/early February
Recommendations: As the carry forward stocks are not enough to cover up the crop damage. The prices are expected to go up in the long run. We recommend covering your requirements as soon as possible on a quarterly or annual basis.
Paprika arrivals have started at domestic markets in Karnataka, mainly in Byadgi and Hubli. Current arrivals are mainly from rain affected areas hence the quality is not good as expected. Crop damage is reported from main areas like Bellary and Byadgi regions which would affect the availability and pricing. Arrivals are expected to increase after January 15th.
Recommendations: Paprika prices have shown a price increase and expected to be at higher levels as the carry forward stocks are lesser and the new crop yield is lesser due to the less color once Paprika has been extracted. The prices are expected to go up further in the long-run , we recommend to cover your requirements as soon as possible in a quarterly or annual basis.
Turmeric harvesting in Karnataka state is expected to begin during January 2022 followed by Maharashtra, Tamil Nadu, Andhra Pradesh, and Telangana. Crop is reported to be same as last year Panangali and Kocha turmeric are expected to be available from February 2022 onwards.
Recommendations: Price are stable now
Ginger harvesting in India is expected to start from January onwards. Crop is reported to be short by 10 – 15% this year Dry ginger prices remained steady in December, and it is expected to continue in long term.
Recommendations: – Ginger prices are expected to remain stable for the time being
Nutmeg & Mace
Nutmeg production in India is short by 40% during this season. All other Origins have also reported short in production during the 2021 – 22 seasons. Prices are expected to increase in the coming months because of the off-season and festival demand.
Recommendations: Nutmeg/Mace prices are showcasing a steep price increase, so recommend to cover the material before further price hike.
Price for Indian coriander is firm at higher price level. We are seeing strong retail demand for coriander and are expecting prices to be firm. Monsoon rains in growing regions have been lower and coriander price has increased by 5% in the last one month.
Recommendations: – Coriander prices will have an upward trend till the next crop season in February. Hence cover your next three months.
Global Market Scenario
Black pepper markets in many producing countries have shown a mixed response due to Christmas and New Year holidays. Prices in India and Sri Lanka reported a positive outlook during December. Indian pepper price responded positively; this could be due to strengthening of Indian Rupee against US Dollar. Indonesian pepper prices in local and international markets reported stable, while Vietnam local price responded negative. Black pepper light berry harvesting in Vietnam has started in many provinces and prices have been stable so far. Pepper harvesting in India has started in the states of Kerala and Karnataka. Arrivals from new crop is likely to increase after January 15th.
Black pepper harvesting in India has started in the states of Kerala and Karnataka. As per the latest estimates, Indian pepper crop would be around 60 – 62 million tons. Secondary reports from Karnataka suggests that pepper crop damage is not so heavy as expected. Good arrivals of imported pepper from Sri Lanka have capped the domestic pepper price in India after the Kerala High court stayed the minimum imported price for pepper proposed by DGFT.
Black pepper harvesting in Indonesia is complete for 2021 season. As estimated, 10 – 15% shortfall in overall production has been reported. Indonesian bold black pepper prices both in domestic and international markets were reported stable during December due to less trade and Christmas holidays but the availability of extraction grade Light pepper was very less hence offers were at higher levels.
Extraction grade white pepper availability was less during the month.
Light pepper harvesting or collection from pepper farms in Vietnam have started. However, the main crop harvesting would likely to commence by January/February only. As per IPC and other surveys, Vietnam pepper production during 2021 – 22 is expected to be lower by 10 – 15% Black pepper availability in Vietnam is good and prices were currently stable, but the prices are much higher compared to last season and are not expected to come down in the long run.
Sri Lankan Scenario
Kandy crop harvesting in Sri Lanka is almost complete. The interim crop was a very low crop with around 1500-2000 tons but the demand from India and Oleoresin companies was high and hence the prices also went up during the month. Black Pepper prices in Sri Lanka remained at higher levels due to good export demand from India. Light berries demand is expected to continue as availability is very less.
Recommendations: Black Pepper/White Pepper prices will be on an increase mode So, we recommend to take forward cover on quarterly or annual basis.
PS – A big thank you to Agro Mills SA @ https://agromillssa.com/ for this great insight.