Cardamom futures witnessed sharp gains last week. Prices traded higher, tracking good demand from domestic and export markets ahead of the festival season. Concerns of lower crop size due to erratic monsoon for the current season supported gains in cardamom futures prices. However, after touching a four-month high of ₹1,293 per kg, prices witnessed a decent correction on profit-booking by traders at higher levels. Thus, October futures closed the week at ₹1,253 per kg, up by 5.7 per cent week on week while November futures closed with a 4.4 per cent gain over its previous close.

Supplies during the week were higher than the previous week. Arrivals were at around 441 tonnes and average prices fluctuated between ₹1,137 per kg and ₹1,260 per kg. However, the maximum price for a superior quality of the spice fetched ₹1,652 per kg. Average prices crossed ₹1,200 per kg after more than six months, indicating strong demand for the aromatic spice.

The second round of harvesting is almost complete in major growing regions of South India amid expectations of a lower crop than earlier estimates. Cumulative monsoon rainfall deficiency in Idukki district until September 15 was 15 per cent below normal rainfall while deficiency in Kerala as a whole was at 17 per cent below normal. Monsoon rainfall is forecast to be widespread across Kerala until September 19.

Cardamom futures are expected to continue their positive trade for the week ahead. Strong buying activities at the spot market are expected to support futures prices.

The writer is Head-Commodity Research, Karvy Comtrade

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