Indian turmeric futures for the April delivery ended the last session higher by 3.30% at Rs.10,054 and the open interest added 0.75% to 6,015 tonnes. Golden spice jumped on strong domestic demand and emerging export orders for Indian turmeric, despite the increasing arrivals in the Nizamabad and Erode mandies. April turmeric contract may touch the high of Rs. 10,300 and support is at Rs. 9,940 per 100 kg.
Technically, turmeric April delivery closed above the 9-day, 20-day and 50-day EMA’s, indicating bullish trend in short term and long term. The 14-day RSI is heading upwards in the neutral zone, ending the last session at 55.63, indicating the contract is likely to add some more gains in near term. The MACD is also moving towards the positive zone is supporting the firm trading. However, the contract may face selling pressure at higher levels in near term on higher production estimation.
According to the latest updates from the spices Board of India, During April-December 2010, Turmeric exports dipped by 13% to 35,500 tonnes while value surged 77% to 50,947.05 Lakhs.
Arrivals started in the Nizamabad and Erode markets. Arrivals are yet to start at Warangal, Salem, Cuddapah and Duggrila spot markets, Manubhai Shah, a turmeric exporter said. Traders expect production to range between 65- 70 lakh bags over the last years 48 lakh bags last year (1 bag = 70 75 kg). However, old crop carry over stocks are very low therefore Reports of low carry forward stocks are likely to support the prices in the medium term.
The latest updates from the Brazilian pepper Trade board shows that, after a series of natural calamities and poor harvests, the price of spices from ginger to nutmeg have rocketed in one of the hidden stories of global food inflation. Traders and brokers reported prices of some spice staples have increased more than tenfold over the past five years and in turn hit food manufacturers and consumers.
Turmeric, another root spice, had a smaller annual crop last year. It is an integral part of Indian cuisine – used in most meals, with few alternatives to its use (when used to colour foods, it is much cheaper than one alternative, saffron). As well as being used for colouring, it is used in India as an aid to digestion, for skin conditions and for other medicinal purposes. Much of the smaller supply is taken for domestic use in India, thus driving up the prices for export.