Turmeric Expected to Zoom on Strong Demand.

Turmeric hit the upper circuit as improved demand supported the prices. Some export queries from mid east Asian countries have been noted. Moderate domestic demand too has been there. Arrivals remained low but exporters are reportedly waiting for corrections before initiating fresh demand in the mandis. Good crop prospects from good rainfall activities in the growing areas have been there. Stockists reportedly held back their stocks in anticipation of a rising demand in coming days. Exports are also expected to rise and that could support the prices in the medium term. Short term trend would remain volatile as traders wait for corrections for buying opportunities.

Prospects of higher crop could however pressurize rates to some extent. Good rains in the growing areas of AP and Karnataka raised possibilities of a better crop this year. With sowing area in these 2 states expected to rise it can pressurize the prices to some extent. Reports of low carryforward stocks are likely to support the prices in the medium term. There are expectations of farmers switching to this crop this year as the returns last year had been good. This is expected to improve the crop production aspects. Good weather prospects are likely to increase the sowing area for the commodity this year and help improve prospects for a better crop. Latest reports from Spice Board of India indicates the Turmeric exports for the period April August have fallen by 13% to 22 250 MT in 2010 from 25 500 MT in 2009.

Source : indiainfoline.com