In January and February, the prices of cardamom had jumped up in anticipation of strong business during Gulfood 2015. This was against fundamentals. The stocks were getting cornered by speculators and stockists. With the jump in prices, buyers reduced their purchases and covered only their immediate requirements as recommended in our last mail. By hindsight, we can see that it was a good decision. The high prices were not supported by demand and the prices have started to decline now.
The unreasonably bullish sentiments in cardamom were dampened as stockists did not see strong domestic or international demand at high prices. They have started to liquidate their stocks. The prices declined by $1.00 per kilo in the bolder grades to $1.50 per kilo in the smaller grades over the last month.
There has been good rainfall in the plantation areas and weather conditions are quite good even now. Though this will have marginal effect on the current crop, it definitely augurs well for the new season. The plant becomes stronger with the current rains and the yields and quality will be good for the coming season. We may also see the new season arrivals start in June itself.
Due to the subdued demand and a large crop still available in the markets, we may possibly have a surplus of 2000-3000 tons of stocks carry forward from this crop in to the next year.
We continue to advise buyers to buy only their immediate requirements.