Cumin Seed Prices Fall by 50% in Anticipation of Bumper Harvest, Set to Impact Spice Inflation
The mandi prices of cumin seeds hit a six-month low, declining by 50 percent in Unjha, Gujarat, signaling a potential relief in spice inflation.
The average mandi prices of cumin seeds (jeera) have witnessed a sharp decline of 50 percent, plummeting from Rs 600/kg to Rs 300/kg in Unjha, Gujarat, often called the epicenter of the cumin trade. This substantial fall is attributed to the speculations of a bumper harvest. While jeera arrivals have already begun in the mandis, the peak of harvest is forecasted to occur by the end of February, potentially leading to further softening of prices.
Cumin Price: Anticipated Bumper Harvest and Expanded Cultivation
Trade sources reveal that the surge in Jeera cultivation this season (2023-24) is a consequence of the higher realisation observed in the previous year. Approximately 1.2 million hectares, primarily in Rajasthan and Gujarat, have been dedicated to Jeera cultivation this season—an increase from the 0.9 million hectares recorded in the preceding year.
Cumin Price: Impact on Inflation and Future Price Projections
It has been anticipated that mandi prices of Jeera could further decrease to Rs 250/kg in the coming month, maintaining a similar level for the subsequent months. This reduction in cumin prices is expected to contribute to a decline in inflation within the spices category, which stood at 19.69 percent year-on-year last month. Traders note that the average price of Jeera in the 2021-22 season was Rs 200/kg, and the recent surge began in March 2023, when prices reached around Rs 450/kg. Jeera futures for the May 20, 2024 expiry and were quoted as high as Rs 26,280/quintal on the National Commodity and Derivatives Exchange (NCDEX) platform on Friday.
Cumin Price: Relief in Spice Inflation and Historical Context
The impact of this price shift is not confined to the local markets. Retail inflation for Jeera reached a staggering 114 percent year-on-year in December 2023, maintaining a three-digit figure since July 2023. The spices variety has been experiencing double-digit inflation since April 2022.
With the significant drop in cumin seed prices, there is a potential for a welcomed relief in spice inflation, offering respite to consumers and businesses alike.
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