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Cumin Price Outlook Firm till Year End – Good Earning Opportunity for Farmers

Jeera prices have trended upwards in recent weeks. Good demand from retail markets and improving export sales had supported the domestic markets. As against last fortnight prices at Unjha which is the benchmark market of India, have appreciated by roughly Rs.500/qtl.

Abhijeet Banerjee

Jeera prices have trended upwards in last two weeks. Good demand from retail markets and improving export sales had supported the domestic markets. As against last fortnight prices at Unjha which is the benchmark market of India, have appreciated by roughly Rs.500 on a quintal. Presently the NCDEX specified grades in Unjha mandi are traded between Rs.14000-14100/qtl. Jeera (cumin seed) prices in the Indian subcontinent has stabilized in last few months, thanks to spot demand improving against cheaper offers, in addition to export deal negotiations, after the lockdown restrictions started reducing. Markets had crashed January onwards because of the corona virus outbreak in China, which is considered as the largest buyer of the spice commodity from India. At the same time supplies were also quite high during March/April, due to the newly harvested arrivals.  

The spot markets had recorded a sharp fall of over Rs. 1,500 per quintal or nearly 10 per cent versus January during the month of February. Lowest prices in this year were in the month of March when the NCDEX quality Jeera recorded a low of Rs. 12750/qtl. Currently prices for the same are fluctuating between 14000-14500 Rs/qtl. As unlocking of economic activities continue, domestic demand has started increasing. Export prospects have even improved as well. Demand for Indian Cumin has improved from UAE and Vietnam in recent months and likely to remain healthy in near future.  

Production in Syria has been reported to be lower by 25-30 percent in this year versus previous year because of the lockdown situation. Therefore exporters from the European Nations are having greater inclination for Indian cumin seed. USA traders had started making inquiries few months back, and exports from India to the United States can get another boost in coming weeks. There is a good market for the Bold and Super bold quality in Europe and the United States. The qualities mentioned are one of the premium qualities of Jeera, having greater medicinal and organic value. China, Middle East Countries and Egypt are other traditional buyers of Indian cumin seed. Turkey and Syria are the nearest competitors in the exports market. India is the leading producer and exporter of Jeera globally. India’s share is around 70 percent of world’s Jeera production, while Syria and Turkey contribute around 20 percent and 10 percent of the total world production of cumin seed respectively. 

Near term price outlook positive, advice for farmers:  

Festive season shall continue while exports are picking up and expected to improve in coming weeks or months. Traders believe that due to lowest price levels in the last 5 years, Jeera sowing acreage may fall 20-25 percent in Gujarat and Rajasthan states for year 2020-21. Farmers may switch to crops rather than Coriander Seed, Chana, Ginger and Mustard Seed in these two states. Still there is time for sowing to commence. (Normal sowing season begins November first week every year, and continues till December). All such factors indicate rise in prices from current rates, in upcoming weeks. But cumin production in India from last year (2019-20) is currently estimated higher by 33 percent at 100 lakh bags (1 bag=60kgs). Last year’s production was closer to 75 lakh bags (for 2018-19). This implies an increase in carry forward stocks of approximately 15-20 lakh bags this year, versus end stocks of compared to 6-8 lakh bags for year 2019-20. So on the whole there may be moderate price appreciation during remaining part of the year. So as of now farmers should hold for earning better margins in Jeera or cumin seeds. Farmers can sell half of their stocks in November after Deepawali, and sell remaining stock till end of December. Going by trade sources, Jeera prices may climb further by Rs.600-800/qtl by December 2020.  

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