High demand may curb fall in chilli prices
KOCHI: Red chilli prices have halved in a year as extended cultivation in key growing states of Karnataka, Andhra Pradesh and Telangana has increased supply but higher demand from spices makers and the international market may arrest the fall.
Production is estimated to be higher by 20% in the three states where harvest is in full swing. Prices for the premium variety Teja, which is largely exported, have plunged from Rs 80 per kg to Rs 140 per last year, prompting a rush from exporters to buy the spice.
“There is strong demand especially from China and Vietnam," said A P Murugan, director of Paprika Oleos (India), a major exporter. As a result of the heavy purchases, the industry feels prices could stabilise around the current level. Average prices of other varieties of chillies have dropped to around Rs 74 per kg.
Curry masala companies have also started buying on a large scale with the drop in prices. Last month, when harvest started, purchases were sluggish in the absence of large buyers following demonetisation.
Production is estimated to be higher by 20% in the three states where harvest is in full swing. Prices for the premium variety Teja, which is largely exported, have plunged from Rs 80 per kg to Rs 140 per last year, prompting a rush from exporters to buy the spice.
“There is strong demand especially from China and Vietnam," said A P Murugan, director of Paprika Oleos (India), a major exporter. As a result of the heavy purchases, the industry feels prices could stabilise around the current level. Average prices of other varieties of chillies have dropped to around Rs 74 per kg.
Curry masala companies have also started buying on a large scale with the drop in prices. Last month, when harvest started, purchases were sluggish in the absence of large buyers following demonetisation.
