Turmeric prices under pressure

Turmeric futures reversed their six-week bullish trend last week. Profit booking on the recent rally of prices, to a 11-month high of ₹7,820 per quintal, triggered the price correction. The recent heavy rainfall across key turmeric growing States such as Telangana, Andhra Pradesh and Maharashtra could support sowing activity, which could further weigh down prices.

August month futures, the most active contract, closed at ₹7,172 per quintal last week, down by 4.6 per cent week-on-week. In the spot market, prices increased marginally on account of good buying. At the Erode market, prices of finger variety turmeric gained ₹300 week-on-week to ₹8,200 per quintal while the bulb variety remained unchanged and closed the week at ₹7,700 per quintal.

According to market sources, Andhra Pradesh MAFED was selling turmeric bought from farmers via NCDEX spot exchange when prices were trading lower.

Sowing has picked up pace over the last few days, following gain in prices at the spot market and the good rainfall in Telangana, Andhra Pradesh and Maharashtra. According to the latest update, the area under sowing in Telangana and Andhra Pradesh has increased by 10 and 25 per cent, respectively, compared to the previous year. In Maharashtra, sowing is complete in 60 per cent of the seasonal area while in Tamil Nadu, it is only 35 per cent.

Outlook

For the week ahead, the turmeric futures contract traded on NCDEX is expected to remain under pressure. Increase in area under turmeric may keep outlook negative.

The writer is Head-Commodity Research, Karvy Comtrade

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