Cumin (Jeera) markets seen stabilizing; farmers advised to hold for getting better returns

Jeera (cumin seed) prices in the Indian subcontinent has stabilized in recent months, thanks to spot demand improving against cheaper offers, in addition to export deals being negotiated, as lockdown restrictions are easing. 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. In the month of February spot markets had recorded a sharp fall of over Rs. 1,500 per quintal or nearly 10 per cent versus January. Lowest prices in this year were in the month of March when the NCDEX quality Jeera recorded a low of Rs12750/qtl. Currently prices for the same are fluctuating between 14000-14500 Rs/qtl.  

Cumin Seed, commonly known as 'Jeera' in India, is a Rabi Spice sown/grown in the winter season between October and December. Usually the new crop is harvested between February and April every year. Largest cumin producing states are Rajasthan and Gujarat. Weather conditions are very important for sowing of Jeera or cumin seeds. Normally yields are better during cooler temperatures with good amounts of water content in the soil. This supports production prospects overall. Another important aspect is the prevailing prices during previous season, since it determines how much sowing the farmers are ready to do in the next season. While higher prices usually encourages farmers to increase the cropped area, lower prices can may force them to shift towards cultivation of other crops like Ginger, Mustard, Ginger, Coriander Seed or Chana.  

EXPORTS MARKET FOR INDIA: Jeera is available in different qualities and prices differ as per the quality. Most traded ones are NCDEX quality, Gold, Bold, Super Bold and Average. Price differentiation is generally based on the fertilizer content, organic nutrients or available moisture percentage. 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. 

EXPORTS PICKING UP: As lock down restrictions are easing, export related deals are increasing. Export prospects have even improved with China as well, which is our biggest consumer, after the earlier border disputes with India eased to some extent. Because of border disputes between India and China, consignments to China were earlier kept on hold. The shipments were processed and transported to China after the tensions disputes reduced between the nations. Demand is improving from UAE and Vietnam as per latest reports. 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. According to Indian exporters, USA has also started making inquiries and exports from India to the United States can commence in coming weeks. 

FARMERS ADVISED TO HOLD JEERA TILL NOVEMBER FIRST WEEK:  

Festive season has started and will continue till second week of November mainly (till Deepawali). 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 and every year and continues till December). All such factors indicate rise in prices from current rates, in upcoming weeks. But one should also consider the fact that cumin production in India from last year (2019-20) has been 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. Therefore 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. Considering prices will remain firm till second week of November- farmers can hold till first week and start selling their stocks in the second week of November.