India To Miss 2010-11 Turmeric Export Target Due To High Prices - Traders .

MUMBAI (Dow Jones)--India will likely miss the turmeric export target of 50,000 metric tons in the current fiscal year because of a sharp rise in prices, traders said Friday.

Turmeric availability in the physical market is poor, which has resulted in a spike in prices, said Ajay Mariwala, managing director of Vallabhdas Kanji Ltd., a top spices exporter.

The average export price has more than doubled to INR136.67 a kilogram in the first five months of this fiscal year that started April 1, from INR62.56/kg a year earlier, according to data from the state-run Spices Board, which sets export targets for various spices.

High prices dragged shipments of the yellow spice during the April-August period 13% lower to 22,250 tons, but pushed up the export value 91% to INR3.04 billion, the data showed.

Prices have surged in the spot market as well. In the major trading hub of Nizamabad in south India's Andhra Pradesh state, the spot price has more than tripled to INR14,591.15 per 100 kilograms as of Friday from INR3,849.40 on Jan. 2, 2009.

India, the world's largest producer and supplier of turmeric, exported 50,750 tons in 2009-10, down 3% from the previous year and missing the target of 51,000 tons. The United Arab Emirates, Iran, Bangladesh and Malaysia are the main buyers of Indian turmeric.

"It seems impossible to export 50,000 tons (this year)," Mariwala said.

He said only a handful of buyers will purchase to fulfill their immediate requirements, while most of them will likely postpone buying until peak arrivals start in March.

Yogesh Mehta of Spicexim, a spices broker, said the current stocks aren't sufficient to last for the next three-four months and the new crop will start entering the market only at the end of January.

Exports will likely pick up from February, he added.

Turmeric production is likely to be around 7 million bags of 70 kilograms each this crop year through June 2011, said Poonam Chand Gupta, a trader in Nizamabad.

The area used for turmeric sowing in India could expand by 30% in 2010-11 as farmers took advantage of higher prices, according to analysts and traders.

For the 2009-10 crop year, the total area is estimated at 175,000 hectares and output is estimated to be around 4.8 million bags.
 
Source : online.wsj.com