Cardamom futures on the MCX witnessed a decent recovery this week from its sharp decline during the previous week. The futures prices opened higher but fell to a five-month low of ₹912 per kg during the first two days of trade due to higher supplies amid weak buying and expectations of higher-than-last-year crop. However, prices recovered from their multi-month low. Thus, December futures closed at ₹971 per kg, up by 3.4 per cent week-on-week while January futures gained 4.1 per cent from its previous week’s close.

At the spot auctions, arrivals dropped during the week as farmers were reluctant to sell their produce due to lower prices. But buying picked up at lower price levels. Arrivals were at 470 tonnes until Friday, lower by 269 tonnes week-on-week while average auction prices traded in the range of ₹786-848 per kg, up by ₹31 from last week’s close.

Rainfall in the first week of November in Idukki district was at 46 mm, lower by 24 per cent than normal rainfall but Kerala as a whole witnessed 15 per cent above-normal rainfall. Cardamom futures are expected to extend recovery on continued buying interest at lower levels.

Going ahead, supplies are expected to drop, which could boost prices at the spot auctions amid improvement in demand.

The writer is Head-Commodity Research, Karvy Comtrade

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