Mumbai: Indian chilli prices may jump by about 15% in next two months on robust export demand and a scarcity of quality produce in the physical market, traders, analysts and exporters said.
“Export demand has been slowly emerging in the market, and we can see a significant rise in demand in the next fortnight,” said Alapati Srinivasa Rao, a trader based in Guntur, Andhra Pradesh.
Guntur is the biggest spot market for the commodity in India.
Spot prices in Guntur have risen 3.22% to Rs4,958 per 100kg this month on a good demand from Sri Lanka and a shortfall of quality produce, said A.P.J. Arun, an exporter.
The poor crop in China and Pakistan, other major producers, will divert importers towards India, said Vibhu Ratandhara, an analyst with Bonanza Commodity Brokers Pvt. Ltd, who expects the spot price to rise to Rs5,700 in two months from Rs4,958.
Demand usually picks up, especially from Bangladesh, ahead of Ramzan, a Muslim fasting month, which this year will begin in early September, he added.
Unseasonal rains have affected the quality of Indian chilli and stocks of medium and best quality produce in cold storages in Guntur have fallen 34.8% at end of first week of July, a trade official said on Thursday. The best quality produce is dark red in colour, larger sized and crispy, while medium is comparatively smaller and less dark.
“The cold storages have around 4.3 million bags, including 1.3 million bags of pataki (white chilli). The rest of the produce is of medium and best quality,” T. Surya Prakash Rao, president, Guntur District Cold Storage Owners Welfare Association, said. White chilli usually fetches lower prices.