Watch Dr Stock’s new TV commercial ~ exclusive!

 

 

Advertisements

JEERA ~ The investment demand may pick up!

India is home to world spices and always been renowned for its best and different spices. Being the largest producer, consumer & exporter, India remains to be dominating player in the world market. Jeera is the second most popular spice in the world after pepper. It has a significant demand for its distinctive aroma and especially in the places where spicy food is preferred.

India enjoys lions share in Jeera global production with around 69% contribution. Apart from India, Syria (8%), Iran (4%), Turkey (4%) and China (5%) are the major producers. Some other countries like Egypt, Pakistan, and Latin America etc also produce Jeera but in small quantity, which is being consumed domestically with no tradable surplus. Jeera arrival at other origins starts from June/July and ends in September, while in India it starts from February and last till March. Global demand for Jeera is around at 75000-80000 MT. Annual consumption of Jeera in India is around 1.14-1.20 Lakh MT while around 25000-30000 MT gets exported annually since last three years. In Syria and turkey only 10 % of the crop is for domestic consumption.

Arrival of Indian crop starts from February and last till April. This early arrival in comparison to other Jeera producing countries India enjoys the supply gap advantage because of none/less availability at other venues. Gujarat and Rajasthan states of India contribute 90% of total Jeera production, remaining part is being cultivated in UP, Punjab & Tamil Nadu.

Domestic Demand and Supply Scenario

Year Carry Forward Stock production Domestic Consumption Exports Cary out Stocks
2008-09

82350

152000

135000

58800

40550

2009-10

40550

176500

138000

47000

32050

2010-11

32050

190000

152000

35000

35050

2011-12E

35050

218000

168000

41500

43500

Production this year is expected to see a rise as key growing areas of Gujarat and Rajasthan have witnessed favourable weather condition post sowing.

Seasonality Patterns

Jeera price seasonality indicates that prices start moving up from March and it will peak during July month of every year. Unlike other agricultural commodities, good export demand will be seen for Jeera during peak arrivals season and at the same time quality will also be good during this time.

OUTLOOK

Due to expectation of bumper crop in current season we expect exports demand may go up as the subdued prices will attract export demand. The weak rupee is also another major supportive factor that has helped the Indian exporters to provide competitively lower prices in the international market. Domestic demand will be another key fact that will support the prices as the ongoing marriage season will push up the demand. The arrival pressure is expected to ease off in the near term as harvesting season in the major producing areas comes to an end. Farmers are currently holding back their stock as they expect prices to firm up as the harvest season ends. Going forward with above mentioned factors prices are likely to go remain firm in the coming months and test levels of 13,300-13,600.