After a fortnight of agitation and boycott of electronic auctions in cardamom, introduced in India last month, traders withdrew their protests on Thursday. They were protesting against the new trading system.
The traders came back to participate in the e-auctions at 4pm at the
Bodinaykanur auction centre in Tamil Nadu.
Getting pricey: The average price of cardamom in August went up to Rs405.25 a kg, against Rs312.14 in the same month last year.
The government trade promotion body, Spices Board of India, which introduced e-auction in August at the Bodinaykanur centre, refused to budge an inch from its tough stance. At a meeting of auctioneers, traders and growers on Wednesday, the board issued an ultimatum saying that if the boycott continued, traditional manual auction at the other auction centres in Kerala would be barred.
Cardamom traders said their two-week long boycott has ended, following discussions with Spices Board officials.
V.J. Kurian, chairman of the Spices Board of India, said the Bodinaykanur centre of the Cardamom Planters Association, where e-auction is held, has computers and servers, which were provided for free.
The centre has received a positive response from cardamom growers, he added.
While all the other centres at Vananmedu, Kumily, Nedunkandam and Pulianmala in Kerala are currently engaged in manual auction, the plan is to replace the system with e-auctions by 1 December. Eventually, all the e-auction centres will get on a single network to go online.
Kurian said the auction system, for which software was developed by Tata Consultancy Services Ltd, ensured anonymity to the bidder, which in turn helps discourage manipulation or price-fixing and dominance by any one buyer or their group. The system seeks to provide transparency in transactions and promotes healthy competition for purchases.
Commodity specifications, such as the moisture and bulk density of lots for sale, are displayed on the main screen at the auction centre. The information helps bidders assess the quality of the commodity. Each lot consists of 50-75kg of cardamom and depending on the season, the volumes traded at auction centres range anywhere from 5 tonnes to 40 tonnes daily.
At Wednesday’s meeting, traders alleged that they did not get sufficient time to see the samples—which can be checked through touch and smell—and also that there had been technological glitches.
Kurian said these issues could be sorted out and it was not right on the part of the traders to boycott the auction. It was hardly a week ago that S. Kannan, marketing director of Spices Board, had held talks with the cardamom traders and promised to ensure smooth trade.
“One needs to give time to iron out the glitches,” he said. “When growers, the ultimate beneficiaries of the trade, are satisfied with the system, there is no reason to oppose it on silly grounds like technological glitches, which can happen at the initial stage,” Kannan said.
The board made it clear at Wednesday’s meeting that manual auction at all Kerala centres will end by November and all of them would switch to electronic trade. At the final stage, the board plans to nationally network these auction centres as well as those at Saklespur, Sirsi and Mercara in Karnataka and the ones in Mumbai and Kolkata.
P.C. Punnose, secretary of leading auction house The Kerala Cardamom Processing and Marketing Co Ltd in Kumily in Kerala, said, “The directive of the board has been to introduce electronic auction from 1 December and we will go by it.”
The country’s annual cardamom production is in the 11,000-tonne range, although output is expected to dip to around 8,500 tonnes this year on account of the late monsoons. The average price of cardamom in August went up to Rs405.25 a kg, against Rs312.14 in the same month last year. India exported 650 tonnes of cardamom valued at Rs22.36 crore during 2006-07. Until July this fiscal year, the country exported 145 tonnes of cardamom worth Rs5.44 crore.