Chilli hot in futures deals, another fire shoots up prices

Chilli hot in futures deals, another fire shoots up prices
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First Published: Tue, May 06 2008. 05 50 PM IST
Updated: Tue, May 06 2008. 05 50 PM IST
PTI
New Delhi: Chilli prices, already ruling high in forward markets owing to a fire outbreak in Asia’s biggest chilli market in Guntur in Andhra Pradesh, shot up another 2% after a private godown in Khammam district in the state was gutted on 6 May.
“Chilli prices shot up in the futures market by 2% to Rs5,320 per quintal following reports of fire in Khammam chilli market. June delivery of chilli was up by 1.17% at Rs5,180 a quintal at 1500 hours,” Karvy Comtrade analyst Veeresh Hiremath said.
Confirming the fire outbreak, Khammam District Collector Shashi Bhushan Kumar told PTI, “The fire broke out at 9:30am in a private chilli godown outside the agriculture market yard.”
“The fire was brought under control within an hour. The loss is not alarming,” he said, adding it was not a major incident like the Guntur fire last week.
However, traders said that about 20,000 bags were damaged in the Khammam fire.
On Monday, prices had hit the upper circuit of 4% on fears of supply crunch as about 2.5 lakh bags of chilli were damaged in the Guntur incident. Another fire outbreak today has further augmented the apprehensions of short supply, a trader said.
Worse, market experts said the June contract is could touch Rs6,000 a quintal in the near-term.
They said unseasonal rains in Andhra Pradesh, the largest producing state, wreaked havoc and 15-20% of crop loss is estimated. The Guntur fire further widened the supply gap, traders added.
They said chilli production is likely to slip to last year’s level of 10.5 lakh tonne. Earlier, the government had estimated about 12 lakh tonnes in 2007-08.
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First Published: Tue, May 06 2008. 05 50 PM IST
More Topics: Chilli | Fire | Khammam | Guntur | Futures |