Electronic auction for cardamom was introduced in India for the first timeat Bodinayakkanur in Tamil Nadu on Thursday.
Launching the system at the Cardamom Planters Association’s auction centre in Bodinayakkanur, Jairam Ramesh, minister of state for commerce, said that after plotting the progress made, the programme would be extended to the other auction centres in Kerala—Kumily, Vandanmedu, Nedumkandam, Pulianmala and Kozhikode—in the next six months.
In the next four years, the other auction centres at Saklespur, Sirsi and Mercara in Karnataka as well as those in Mumbai and Kolkata would be brought under a national auction network. This is being done so that trading could be carried out from any part of the country.
The programme, an initiative of the trade promotion body Spices Board of India, has been developed with help from Tata Consultancy Services Ltd, said Spices Board chairman V.J. Kurian.
It seeks to provide transparency in transactions and promote healthy competition for purchases, he added.
The new system would not reveal the identity of the bidder to discourage the chances of speculation or dominance by any one buyer or group. Plans were also under way to introduce electronic auctions in chilli and tobacco, Kurian added.
The moisture and bulk density of every cardamom lot offered for sale will be displayed on the main screen at the auction centre and that would help the bidders to assess the quality of the product, the board said.
However, Zia-ud-din Ahmed, joint managing director of the Kerala Cardamom Producers and Marketing Co., had reservations about the auction system because it is the touch, feel and smell of the cardamom that determines the quality and the decision to make a bid. This will be found lacking in the new system, he said.
To ensure early payment after an auction, the board has been advised to revise its rules so that remuneration can be made to the seller in 14 days from the current 21.
Ramesh said that since farmers needed money and they were being exploited by some of the auctioneers demanding exorbitant interest for the immediate payment of dues, the commerce ministry had given the Spice Board the go-ahead to amend its rules.
Cardamom is a mainstay crop for thousands of farmers in the three southern states of Kerala (75%), Karnataka (15%) and Tamil Nadu (10%).
The volume of business in the auction centres in 2006-07 was 7,939 tonnes. The average price realized at the auction centres was Rs313.02 per kg.
In India, the maximum quantity of cardamom is auctioned in Kerala, followed by Tamil Nadu, Karnataka and Maharashtra.