The new crop of Cardamom is just around the corner. There is good quantity of carry forward stock from last year at almost all the producing and consumption centers. However this mainly consists of rejections and lower grade stocks. The price increase during the early part of this year has led to most stockists holding back the stocks which been liquidated in the past few weeks. Good quality cardamom is now scarce.
There has been good rainfall in the months leading up to the official start of the monsoon season. The forecasts for the rainfall in the weather districts around the centers of production have also been good. The likely deficit in the national average rainfall may be over the central and northern parts of India. Hence the weather conditions are quite favorable for the new crop. There has been almost no gap between the end of the season and the new crop in this year.
Trader estimates are that the new crop would be more than 25000 tons this year. Almost all the planters we met reported a higher production over last year. We already saw small lots of the new crop in the auctions though ofcourse the quality was immature. There has also been an increase in the acreage of cardamom plantations in the past and hence it is likely that the production estimates may be revised upwards.
The exports have been good in the year ending March 2015 which is about 3500-4000 tons. We expect that the exports may further increase in the coming year as the new crop arrivals will coincide with the Eid in the middle of July. There will be a surge in demand for the new crop for the Eid festival. Besides, the MET department has forecasted a gap of a few days after the initial wave of rainfall before the monsoons revives again. During this period, we expect the prices to firm up. However, prices should stabilize again as the arrival pressures will test the support from the exporters and the domestic markets.
We advise buyers to cover their requirements for the next couple of months.