MUMBAI (Commodity Online): Turmeric rates recovered further on short covering even as low trading activities continued in the mandis. Some demand from North India was there.
The new crop is expected by mid-February and traders are also reportedly waiting for the new crop arrivals for fresh demand. Traders feel present rates are very low even as expectations of higher production continuously weighed on the market sentiments.
Higher production prospects and better stocks could however keep pressure on the market sentiments as markets trade with high volatility.
Reports of stockists holding onto stocks at these lower levels as they anticipate rates improving in coming days.
Good Monsoon reports in AP has reportedly keeping the sowing activities proper. The area sown would however depend on market rates and if falling trend continues, traders expect the sowing area may fall as farmers may shift to other lucrative crops like cotton, soybean etc.
The total production this year is expected to touch 75-85 lakh bags (1 bag-75kg) - higher than the 65-70 lakh bags in 2010-11. Higher acreage from the high rates is stated the reason for the rise in expected production as per traders.
Good stocks and increased selling pressure along with weak demand in the mandis have kept trend weak for the commodity over the last few weeks. The sowing period is from June-August and harvesting begins in January.
High moisture content in the current crop kept demand low and thus kept pressure on the market prices. With an expected 5-6 lakh bags of old stocks with farmers, there are expectations of higher arrivals of these stocks in the markets before new crop arrivals.
Latest reports from Spice Board of India indicates the expected Turmeric exports for the period April-Nov 2011 have risen by 63% to 58000 MT in 2011 from 35500 MT in 2010 same period.
Courtesy:Religare Commodities
