Turmeric softens because of more supply and weaker demand

Due to weak demand and record production in the 2021–22 crop year (July–June), dealers claim that turmeric has reversed the gains seen after Diwali. “Shortly after Diwali, turmeric prices in Telangana and Maharashtra marketplaces increased by $300–$400 per quintal. However, due to a decline in demand, they have already returned to their pre-Diwali levels. This is because last year’s production was higher, according to RKV Ravishankar, president of the Erode Turmeric Merchants Association.

The price of finer turmeric at the Agricultural Produce Marketing Committee (APMC) yard in Erode surged from 6,641 rupees per quintal before Diwali to 7,131 on November 18, then decreased to levels of 6,700 at the moment. The Rajapur variety’s modal price in Sangli APMC yard in Maharashtra had reached $7,500 a quintal on November 18 before falling to $6,500 right now. December polished turmeric contracts on NCDEX are trading at $7,230.40 now.

Since last year’s production was higher, farmers are still holding onto their inventories. Prices have since softened as a result, according to dealer Poonam Chand Gupta of Nizamabad. “Fears of crop loss from last year’s unseasonal rains have proven unjustified. Farmers in Maharashtra and Nizamabad appear to have stocks, according to Amrutlal Kataria, a dealer from Nizamabad.

The Ministry of Agriculture estimates that 13.31 lakh tonnes (lt) of turmeric will be produced in 2021–2022, up from 11.76 lt in the prior year. Turmeric production rose by 25% last year in places like Nanded in Maharashtra, according to Gupta. In addition to increasing production last year, demand was muted even in December. The demand is often weak, according to Ravishankar. On the other hand, the demand for exports has been consistent up to this point. “Export demand has not been very strong. Maybe we can call it slack now,” Gupta suggested.

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