Cardamom on MCX settled down -1.71% at 1203 on profit booking after prices gained amid surge in physical demand for cardamom in the domestic spot market. Further, insufficient stocks position amid restricted supplies from producing regions also added support to cardamom prices. In the Cardamom Processing & Marketing Co-Operative Society’s sale, arrivals stood at 33.92 tonnes and almost the entire quantity was traded. A bullish sentiment has surfaced following reports of a sharp fall in output of the crop during the current season, trade sources said.
Added to this, inventories in the upcountry markets have reportedly been exhausted, resulting in fresh buying to replenish stocks to meet the Diwali demand. Export shipments in 2016-17 are expected to drop due to expectations of less availability on higher domestic consumption and higher prices. Domestic consumption is expected to be about 12,000-15,000 tonnes. The country exports roughly 15-20 per cent of its total cardamom production, thus, next year exports may be around 3,500-4,000 tonnes. Last year, cardamom exports jumped 35.8 per cent over the previous year to 5,938 tonnes, according to Department of Commerce data.
The growth was driven by higher production and lower prices. Cardamom prices have been on the rise on expectations of a late harvest and lower production. This increase in prices is mainly attributed to the long dry spell in cardamom growing areas of South India, which is expected to impact cardamom production in the 2016-17 season. Technically market is under long liquidation as market has witnessed drop in open interest by -10.73% to settled at 965 while prices down -20.9 rupee, now Cardamom is getting support at 1185.3 and below same could see a test of 1167.5 level, And resistance is now likely to be seen at 1227.7, a move above could see prices testing 1252.3.
--Cardamom trading range for the day is 1167.5-1252.3.
--Cardamom prices dropped on profit booking after prices gained amid surge in physical demand for cardamom
--Inventories in the upcountry markets have reportedly been exhausted, resulting in fresh buying to replenish stocks.
--The country exports roughly 15-20 per cent of its total cardamom production, thus, next year exports may be around 3,500-4,000 tonnes.
--Cardamom prices in spot market gained by 12.50 rupees and settled at 1142.50 rupees.
Courtesy: Kedia Commodities