Cardamom growers want open market sale

George Joseph / Chennai/ Kochi Aug 17, 2012, 00:07 IST

Cardamom growers of Idukki district in Kerala have urged the Union government to opt for the open market system instead of auction trading.

A section of the growers in a recent meeting also wanted floor price for cardamom as the market was depreciating. The average price now is Rs 750 a kg from 900 during March-April.

According to growers, fresh supply dropped 50 per cent in the beginning of the current season as bad weather affected plantations. Extreme summer and later poor monsoon damaged the plants widely across the district, which accounts for around 60 per cent of the production.

The price is being decided by only a handful of traders at the auction centres, said a Kattappana-based grower, adding they had to sell according to this price. In most cases, traders collect cardamom from farmers at lower than the average price in the auction. Traders who have the licence from the Spices Board can participate in the auction. As there is no open market sale for the spice in the producing centres, farmers have to depend on these traders and the prices quoted at the auction centres.

Reji Njallani, president, Human Rights Protection Council for Farmers, a newly-formed association of various crop farmers, told Business Standard they were finding it difficult to carry on with the cultivation as the per kg cost of production comes to around Rs 800. Moreover, rise in wages and labour shortage have hit them hard. Though the average daily wage for plantation workers has increased to Rs 400, they still could not employ easily as their number is less compared with the demand. Crops like cardamom and pepper are highly labour-intensive.

He said shifting to the open market system could ensure a price range of Rs 1,500-2,500 a kg for cardamom. India produces 13,000 tonnes annually but this time it would be below 9,000 tonnes. The shortage, however, is not yet reflected on the price line because of the auction system.

There is good demand for cardamom in the global market as Guatemala, the world’s largest producer, is selling around 25,000 tonnes annually. Exports from India was 1,175 tonnes in 2010-11 and at an all-time high of 4,650 tonnes in 2011-12, according to the Spices Board.

Though there is good demand, India is not able to exploit the overseas market, said farmers. Due to the growth in global demand, a number of African countries like Nigeria and Ethiopia have started cultivating cardamom in a big way.