Jeera prices rose to an all-time high of Rs 48,000 per quintal a few days back and are threatening to breach the Rs 50,000-mark over speculation of a more-than-expected drop in production.
According to traders’ assessments, jeera production is estimated to be 8-12 per cent lower in FY24 at 6.5 million bags as against the initial estimate of 7.5 million bags (1 bag=50 kg). The drop in production is due to unseasonal rainfall in March. Last year’s production was also lower at 6.6 million bags compared to 8-8.5 million bags in the 2021-22 crop year.
Some experts expect the crop size to be even lower at just 5 million bags, which has created a panic in the market.
The Centre, in its last advanced estimates, said jeera production will be 200,798 tonnes (4-4.5 million bags) in FY24. According to a report by Origo Commodities, after the unseasonal rainfall, daily jeera arrivals dropped to 25,000-30,000 bags (1 bag=55 kg) across the country, half of last year.
However, some experts said prices were shooting up due to speculative activity in the major markets. “Such record prices aren’t sustainable and there will be a sharp correction in the coming weeks,” a researcher from a leading commodity trading firm said.