What lies ahead for Jeera after testing 39765?

Jeera is one of the most widely used spices in Indian cuisine. It is also a major export commodity for India, which accounts for more than 70% of global production and trade. However, this year, prices have soared to unprecedented levels due to a combination of factors that have adversely affected the crop. The main reason for the price hike is the unfavorable weather conditions that have prevailed in the major jeera-growing states of Gujarat and Rajasthan since early March. The prolonged dry spell followed by unseasonal rains and hailstorms has damaged the crop at various stages of growth and development, resulting in lower yields and poor quality.

According to market sources, the total size of India’s jeera crop, which was estimated to be 70 lakh bags (3.85 lakh quintals) at the beginning of the season, is now expected to be only around 50 lakh bags (or 2.75 lakh quintals). This is a significant drop from last year’s output of 88 lakh bags (4.84 lakh quintals). The lower production has also affected the arrival of jeera in the physical markets. Normally, jeera arrivals peak in April, but this year, they have been very low and have declined by more than 50% compared to the same period last year. The tight supply situation has created a strong demand for jeera from both domestic and export buyers, who are willing to pay higher prices to secure their stocks.

The outlook for jeera prices remains bullish in the near term, as the demand-supply gap is likely to widen further. The domestic consumption of jeera is expected to increase during the upcoming festive season, while the export demand is also strong from countries like China, Bangladesh, Sri Lanka, and the Middle East. Moreover, the global supply of jeera is also limited, as other major producers like Syria and Turkey have also faced crop losses due to political unrest and weather issues. Therefore, jeera prices may continue to rise until the next crop arrives in February-March next year.  The Value Chain Participants are hereby advised to trade further with a word of caution because we expect that beyond 40 K levels, there could be a speculative pullup of the prices to 43-45 K but the sustainability of such prices could be a concern in the near term.