Cardamom on MCX settled up by 4% at 1390 on lower output and good demand from exporters and stockists. As supplies of good quality material have increased in spot auctions, good buying activity from traders and stockiest can be expected. Even exporters are expected to cover their requirement amid fears of shortage of crop in coming days. Export demand is good from Saudi Arabia irrespective of higher prices. Farmers are expected to hold their high-quality cardamom and may release when prices surge due to shortage. Present dry weather in the main producing centers may hit the output. Arrivals are likely to decline from November due to dry weather. India’s Production is likely to fall by 30-40% in 2016-17 due to unfavourable weather conditions. Prolonged dry weather occurred in the Idukki district, which has severely affected yield of the crop, which was in the flowering stage at that point of time. In many cases, the plants have been partially or fully destroyed due to the dry weather, as many plantations in the region do not have irrigation facilities. The Spices Board had reported in June that cardamom crop loss due to deficient rainfall and high temperature is likely to be up to 20-25% during the 2016-17 crop season. Damage to plants in Idukki due to drought-like conditions is 5-10%. Board data shows production of small cardamom during 2014-15 pegged around 18,000 tonne from 69.970 hectares. Technically market is under fresh buying as market has witnessed gain in open interest by 16.85% to settled at 1047 while prices up 53.4 rupee, now Cardamom is getting support at 1360.6 and below same could see a test of 1331.3 level, And resistance is now likely to be seen at 1404.6, a move above could see prices testing 1419.3.

Trading Ideas:

Cardamom trading range for the day is 1331.3-1419.3.

Cardamom prices gained on lower output and good demand from exporters and stockists.

Present dry weather in the main producing centers may hit the output.

Arrivals are likely to decline from November due to dry weather.

Cardamom prices in spot market gained by 48.50 rupees and settled at 1266.40 rupees.