Technically Turmeric market is under long liquidation as market has witnessed drop in open interest by 0.58% to settled at 8585 while prices down 50 rupees.
Now NCDEX Turmeric is getting support at 5476 and below same could see a test of 5450 levels, and resistance is now likely to be seen at 5544, a move above could see prices testing 5586.
Turmeric yesterday settled down by 0.9% at 5504 due to poor demand, both locally and from the upcountry markets. This may be due to the availability of good quality turmeric at cheaper prices.
The spice was cultivated over about 70,000 acres of land in Tamil Nadu but now it has decreased to about 40,000 acres. The farmers, for want of getting feasible price, have reduced the acreage and have switched over to other cash crops like banana.
Every year Tamil Nadu’s share was about 10 lakh bags (of 70 kg each) of turmeric, but now there are only about 7- 8 lakh bags approximately that come to market. Further, all the traders in North India are having stock and so they have decreased the buying.
At present the turmeric is cultivated over 14,000 acres in Erode district and the State Government has decided to start a “Turmeric Centre” near Modakurichi. Last year, finger variety was sold at ?6,000-6,500 a quintal and this year too it is selling at about ?6,000.
Erode farmers are demanding that the government procure all the turmeric directly at ?10,000 a quintal. Even as neighbouring Sri Lanka has banned imports of Indian turmeric, the trade here seems to be unfazed.
The Sri Lankan government banned turmeric imports in December 2019 to encourage local production of the spice crop and to protect small and medium-size businesses.
Trading Ideas:
–Turmeric trading range for the day is 5450-5586.
–Turmeric settled down due to poor demand, both locally and from the upcountry markets.
–Pressure also seen amid reports of higher carry forwards stocks from last year due to higher production.
–Production for the marketing year 2020-21 is expected to be around 5.20 lakh tonnes on the preliminary basis.
–In Nizamabad, a major spot market in AP, the price ended at 5587.5 Rupees remains unchanged at0 Rupees.