Dealing Room Check: Turmeric subdued on fresh arrivals



Turmeric futures ended on a weak note last week. The most active April-month futures contract started the week negatively and traded lower on most of the days.

Increase in new turmeric crop arrivals across major spot markets weighed down the futures price. The turmeric crop in Maharashtra is set for harvest and arrivals are expected to flood the markets in the State in the next few weeks.

Given the expectations of bumper production this year, prices may be very volatile. Demand, however, remains lacklustre, with only few upcountry orders. During the week, turmeric futures tumbled to a fresh two-year low of ₹6,500 per quintal which is 4.69 per cent down compared to the previous week’s close.

The turmeric futures contract remained under pressure due to higher supplies in the market. The most active April futures closed the week at ₹6,700 per quintal, which is lower by 2 per cent from the previous close.

Outlook

For the week ahead, turmeric futures contract is expected to remain under pressure, tracking increasing supply in the market. Demand from industrial users is currently weak as they await more correction in prices.

Upcountry demand is normal, with only a few orders from buyers from North India. Turmeric production in the current season is estimated to be higher than last year due to increased acreage and favourable weather conditions during most of the growing stage.

The writer is Head-Commodity Research, Karvy Comtrade

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