Cash Crunch Makes Car­damom Costlier

Dis­rup­tion caused has pre­served stocks, which are now 40% more valu­able

The Economic Times - - Fi­nance & Com­modi­ties - Kr­ish­naku­mar.PK @times­group.com

Kochi: The car­damom in­dus­try has gained hand­somely from de­mon­eti­sa­tion be­cause the dis­rup­tion caused by the cash crunch has pre­served stocks, which are now 40% more valu­able fol­low­ing a sharp in­crease in prices in re­cent weeks. Planters said with out­put down by as much as 50% last year, the stock would have run out if de­mon­eti­sa­tion had not slowed down ac­tiv­i­ties of the grow­ers.

“For sev­eral weeks af­ter de­mon­eti­sa­tion, pluck­ing slowed down as grow­ers found it dif­fi­cult to pay wages and they were un­able to sell large quan­ti­ties with sev­eral big buy­ers stay­ing away from the auctions due to the cash crunch, said PC Mathew, sec­re­tary of Car­damom Grow­ers As­soci- ation. As cash curbs have eased, grow­ers have been re­leas­ing the stock with prices at a fiveyear high, Mathew said. Daily ar­rivals are av­er­ag­ing 50 tonnes. Pro­duc­tion last year is es­ti­mated to be 10,000-15,000 tonnes, which is al­most half of the out­put in the pre­vi­ous year. As a re­sult, prices have been stay­ing over .₹ 1,000 per kg over the past three months, ris­ing to .₹ 1,3501,400 per kg over the past few weeks. “The in­ter­nal de­mand is strong and so buy­ers are ac­tive,” said Sa­jan Kurian, chair­man of South In­dian Green Car­damom Com­pany. “The stock is ex­pected to last for some more weeks. Prices could flare up in the ab­sence of sum­mer rains as the wa­ter sources are fast dry­ing up, spoil­ing the prospects for the next sea­son.” Overseas ship­ments, how­ever, have suf­fered from the high prices. Ex­porters have not been able to re­alise equiv­a­lent prices in the global mar­ket with the ad­vent of car­damom from Gu­atemala, the largest pro­ducer of the spice. In­dian car­damom used to fetch around $20 per kg be­fore De­cem­ber as the coun­try was the sole sup­plier.

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