High domestic prices of various spices has trade eyeing imports

High domestic prices of various spices has trade eyeing imports
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First Published: Tue, Jan 01 2008. 11 16 PM IST

Easy route: India imported 450 tonnes cardamom from Guatemala between April-November 2007, up from 240 tonnes in the year-ago period.
Easy route: India imported 450 tonnes cardamom from Guatemala between April-November 2007, up from 240 tonnes in the year-ago period.
Updated: Tue, Jan 01 2008. 11 16 PM IST
Kochi: Rising prices of spices are making imports attractive and causing concern at Spices Board, the Indian government’s trade promotion body.
Though 2007 imports didn’t exceed the previous year’s figures, traders are increasingly worried that stubbornly high domestic prices may trigger higher spice shipments into India over the next few months.
Easy route: India imported 450 tonnes cardamom from Guatemala between April-November 2007, up from 240 tonnes in the year-ago period.
Some traders say they are also apprehensive about under-invoicing, or showing a lower price than the actual price, paid for importing spices. There were instances of importers bringing in poppy seeds at $1,500 (Rs59,100) a tonne from Turkey when the actual prices prevailing there were $5,250. By showing lower prices, importers pay lower duties. To tackle instances of duty evasion, the office of the director-general of foreign trade then fixed a price of $5,398 per tonne for poppy seeds in December. Traders expect a similar move in cardamom, ginger and cloves.
Spices Board chairman V.J. Kurian says the board has been checking details of imports, prices and stocks with the traders and hasn’t noticed a spike in imports.
India imported 450 tonnes cardamom from Guatemala between April-November 2007, up from 240 tonnes in the year-ago period.
India has been a major importer of cloves, with average imports of 7,500 tonnes annually. Until November, imports have been at least 4,500 tonne, higher than the 3,500 tonnes in the year-ago period. While import price of cloves has been nearly half of the domestic price of Rs250-300 a kg, importers pay a 35% duty.
In case of pepper, whose price is at around Rs140 a kg, imports between April-November have been over 8,100 tonnes, down from 13,100 in the year-ago period.
Traders also worry about higher imports of turmeric in 2008 even though only 4,500 tonnes were imported between April-November 2007, down from 5,400 tonnes in the year-ago period. Traders say imports of turmeric with high content of curcumin, the pigment that gives it the yellow colour, is primarily for oil extraction industry.
A good amount of raw ginger is being imported this year. Total imports of ginger, including dry ginger, so far has been around 12,000 tonne, lower that 13,000 tonne last year. Dry ginger with an import duty of 30% might flow in with the domestic prices ruling around Rs45-60 a kg, sharply higher than the import price at Rs30 a kg.
Garlic too has seen lower imports so far at 250 tonne, less than one-third of what was seen last year. However, traders allege that a section of the trade has been importing the commodity through Pakistan which is not a producer of garlic. This is being done since import from Pakistan does not attract duty on certain commodities by virtue of the free trade agreement that India has with Pakistan.
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First Published: Tue, Jan 01 2008. 11 16 PM IST
More Topics: Spices | Duty | Garlic | Clove | Money Matters |