Turmeric ended down for second day on long liquidations. The NCDEX turmeric April contract ended the day at Rs 6,724, down Rs 6 or 0.09% from last close.
Yellow spice prices swelled in the local mandis on strong physical market demand. Bad weather is likely to affect the yield of the current crop. As per market sources, turmeric production in 2012-13 is expected around 50-60% lower compared to last year's historical high of 90 lakh bags (1 bag= 70 kgs). This is mainly due to fragile sowing in major producing states such as Andhra Pradesh and Maharashtra. moreover, dearth of selling by cultivators and strong offtake by investors also propelled strong gains in turmeric market. Most of traders and stockiest are anticipating the hike in Minimum Support Price of turmeric to Rs 10,000 per quintal in 2013 due to higher cultivation cost.
Golden Spice or Turmeric is used to flavour and to colour foodstuffs. It is used in cosmetics and in medicines. Turmeric is ready for harvesting in 7-9 months. Sowings start from may end and extend till august whereas arrivals start from February and extend up to May. The market sources said, currently stocks of the spice with higher curcumin level at 5% which is unavailable, thereby supporting prices in the spot markets. Buyers are waiting for fresh crop which will be having more Curcumin content. The commodity is expected to move higher in medium term on the back of strong spot demand and weak production estimations.
Turmeric swelled 27% in December on strong demand against the weak production estimations. The counter eased marginally after hitting high Rs 6858 level. Futures consolidated at higher side and prices start seeing some resistance for further gains. Turmeric April contract ended the day at Rs 6,724, down Rs 6 or 0.09% from last close and the open interest dipped 30 tonnes to 28,160 tonnes, indicating long liquidations.
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