Angel Commodities report on Turmeric
Turmeric futures closed lower on Wednesday on expectation of weak spot demand due to quality issues. The prices of turmeric is moving sideways due to mixed fundamentals of good sowing acreage coupled with declining supplies. The demand from the industrial may support prices. The Sep’16 delivery contract on NCDEX closed 0.25% lower to settle at Rs 8,140 per quintal.
Turmeric acreage in Telangana as on 10 Aug was up 14 % at 43,000 hectares as compared to 38,000 hectares last year. Area in AP also higher by more than 5%. The acreage of turmeric is higher compared to normal in both states. As per dept of commerce data, turmeric exports in April- May 2016 increased by 31% compared to last year at 21,256 tonnes. In 2015-16, 85,426 tonnes exported compared to 90,738 tonnes in 2014-15.
Major export destinations in 2015-16 are Iran, Malaysia, UAE, USA and Sri lanka. The arrivals in the main physical markets such as Nizamabad, Duggirala (AP), Salem, Erode and Sangli reported decreasing. There is expectation of lower arrivals and good upcountry demand may lend support in coming weeks.
We expect turmeric to trade sideways to down on expectation of better climatic conditions in growing areas and decrease in physical demand from up-country buyers.