Turmeric is likely to shine in 2024 when indifferent weather hits the crop

Turmeric, one of the must-have spices in every Indian kitchen, could pinch your pockets in 2024 as indifferent weather is likely to reduce production this year  by 25 percent, traders and analysts say. In October-November, however, the record low demand can calm and soften the situation.  Gujarat-based Shreeji Agri Commodity Pvt Ltd. According to the company’s Jagdeep Grewal, market reports indicate that turmeric plantations are 25-30 percent lower than in the normal area.  

Go to other plants

  “Turmeric production in 2023-24 is expected to remain lower due to adverse weather conditions during the sowing season and farmers shifting to other profitable crops”, said Anu V Pai, analyst at Geojit Financial Services. Turmeric yields can be 20-25 percent lower in Tamil Nadu, 20 percent lower in Telangana and 20-25 percent lower in Andhra Pradesh. On an average, the yield is expected to be 20 to 25 per cent lower”, said Ankit Agarwal, director of Erode-based Amar Agarwal Foods India Pvt Ltd. “The northern crop like Maharashtra is feared to be 30 percent lower, while in Tamil Nadu it is expected to be 20 percent lower”, said RKV Ravishankar, president of Erode Turmeric Traders Association. “According to the market estimate, the harvest was 4,87,500 tons, compared to 7,35,000 tons of the previous season, that is 33 less. That is why the prices started to rise after that, although they have cooled down a bit from the peak”.

 Record low demand

  “Constant harvest conditions are seen as average. According to the Spices Board, the production of turmeric in 2022-23 was projected to be around 1.16 million tonnes, and according to market estimates, the production in 2023-24  will be 10-12 percent lower”, says Geojit’s Pai.  “The harvest has been affected by the prolonged drought across the country. Although it rained later and some have sown crops, we have to see how much is harvested”, Ravishankar said.   Agarwal said prices initially rose to ₹16,000 per quintal in the futures market before settling to around ₹12,000. “Prices fell mainly because demand was completely weakened in the previous two months. Now that  prices have come down, demand is back. People are probably happy with those prices, Ravishankar said, “In 50 years of business, I have not seen such  low demand, especially in October-November”. Currently, turmeric for April delivery  is priced at ₹ 14,320 on NCDEX. Spot price of polished turmeric in Nizamabad, Telangana is ₹ 13,282.60 per quintal. Premium Rajapur Turmeric is priced at ₹ 14,710. 

Trendsetters ahead

  The modal price (the rate at which most transactions take place) of finger turmeric at the Agricultural Produce Marketing Committee factory in Erode was ₹ 10,850 per quintal on Friday, while it was trading at ₹ 10,926 in Nizamabad. “Prices have cooled a bit now (But there is) a very significant decline (in production). We may see prices move through small bounces or dips through January. Once crop production clears up, prices will start to pick up. There’s more of an uphill climb,” said Grewal. Pai said, “The new harvest is expected to begin after mid-January. Production,  harvest and post-harvest climate conditions, festival season demand and export demand may determine the trend in the coming days. Agarwal said that since prices are good, probably at record highs, farmers will feel encouraged to use turmeric next year. “This means that 5-7 lakh bales (50 kg each) are left for seeding the production. So to that extent, there may be further shortage of supplies”.   NCDEX’s April turmeric contracts are above ₹ 15,400-16,400 per quintal  and ₹ 12,900-12,400 per quintal respectively, Pai said.

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