Market Report – September 2021
Chilli / CapsicumChilli harvest season in India is from February to May.
Sowing of chilli seeds for 2022 harvest has started in July and will continue till September.
Red chillies have been highly profitable crop for farmers in last 2 years and there is increased interest in farmers to cultivate red chillies. Initial estimates indicate 25% larger sowing area for capsicum chilli for 2022 season.
We will have a clear idea on 2022 crop size by November 2021. Weather conditions have been conducive for the crop. Carry forward stocks available in cold storage is at higher prices.
Price for chilli is staying firm at higher price level as farmers are expecting better prices from export demand for red chillies.
Recommendation’s: Prices are expected to remain at higher levels for the upcoming three months
Extensive Paprika cultivation is reported from growing regions in Karnataka state. Paprika includes - all varieties of low pungent and high colour varieties. Weather conditions and water availability has been good so far which has been good for the growth of the chilli plants.
Market trend: Paprika prices remained higher during the month due to good demand from North Indian buyers. Prices would stay at higher levels due to limited availability and festival season demand in the medium term.
Recommendations: Paprika prices have shown a price increase and expected to be at higher levels till the next crop in January 2022. Hence cover your requirements till December with Agro-Mills
Turmeric crop next season is expected to be almost same as per reports. Sowing for 2022 season has started in May and will continue till end of August. There are reports on floods and water logging in some of the farms in Maharashtra and Telangana.
Price for Turmeric in 2021 season was one of the highest in last 3 years. Initial estimates indicate 15% larger sowing area for 2022 season. Higher curcumin turmeric carry forward stocks are expected to be lower.
Recommendations: Higher curcumin turmeric carry forward stocks are expected to be lower. Hence recommend to cover for the next 3 months with Agro-Mills.
Nutmeg & Mace
The Nutmeg production is less by 40% in India during 2021 season and other origins also reported short production as reported earlier. Nutmeg prices across the globe remained at higher levels during July and it is expected to increase during the medium and long term. Prices are expected to stay at higher levels during long term.
Recommendations: Nutmeg/Mace prices are showcasing a price increase and have started to show 5% price increase compared to July, so recommend to cover the material before further price hike.
The Ginger crop is in its vegetative stage in all the growing regions of India. The weather has been ideal so far for the growth of ginger cultivation. The area under ginger cultivation is expected to come down next season as farmers have not increased their area due to low prices they got during this season.
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.
Growing regions received unseasonal rainfall in month of April – May 2021. The unseasonal rainfall has adversely affected the quality of the crop. The total crop production is similar to 2020 crop size.
Market trend: - Prices are steady at the moment
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 till October 2021. 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 with Agro-Mills
Global Market Scenario
Black pepper across the globe have shown a positive outlook during August. Indonesia, Vietnam and Sri Lanka continued its firm trend while Indian pepper prices was almost steady during the month. The good export and domestic demand have caused the prices to go up in Indonesia and Vietnam pepper prices at the domestic markets. Black pepper prices are likely to continue firm in September as harvesting in Sri Lanka and Indonesia are disrupted and also due to the logistic issues because of Pandemic.
2021 – 22 pepper crops in India is expected to be almost same as last season due to the current favorable weather conditions prevailing in Kerala and Karnataka states. The current sunny weather conditions along with interment rains are helping the berry seeing in pepper plants as of now.
The Second wave of Covid pandemic in Indonesia almost disrupted pepper harvesting and hence the availability of light berries was limited. Most of the pepper processing and trading centres were closed during the month and much trade did not happen during the month as normal life was paralyzed due to pandemic restrictions during the month.
Vietnam pepper crop is in its flowering and berry seeing stages. As per the secondary reports the next season is expected to be beer than last year as farmers have been taking good care of their crop this year due to beer prices this year. Sources are forecasting the production to be above 200,000 tons more than the IPC projection of 180,000 tons for next year.
Sri Lankan Scenario
Major black pepper season in Sri Lanka is complete. There was 40% reduction in crop production as compared to normal production level. Sri Lanka was in lockdown from April 2021 till June 2021. There was minimal interest from farmers and traders in plucking and processing black pepper due to covid related restrictions.
This led to green pepper getting mature and not feasible for extraction purpose. The delayed harvest has adversely affected the production of light berries for extraction industry and we had 60% lower crop availability of light berries as compared to 2020 season.
Recommendations: Black Pepper/White Pepper prices will be on an increase mode till the next Vietnam season (Feb- March 2022). So, we recommend to take forward cover with Ago-Mills
Port Congestions, Transshipment Delays
Sri-Lanka, Singapore, Cochin. Mumbai, Mundra Ports are facing serious issues with container availability, hence resulting in shipment delays and transshipment delays as well. The Port congestion at Durban and Cape Town adds to issues as the operators are not showing major interest to sail to these ports as it takes longer off-loading time. Compared to the previous years, the transit time have increased by an additional 2-3 weeks to get the materials into South Africa.
Freight Charges increased
Freight Charges are increasing on a daily basis, which is now almost unpredictable these days. Adding on the cost of the product, clearances, transportation.