Cardamom on MCX settled up by 1.35% at 1389.5 on good buying amid a squeeze in supply at auctions held in Kerala and Tamil Nadu. Upcountry dealers as well as exporters were covering as it has become clear that no arrival of fresh cardamom will take place till the next season picking begins, by mid-June. This sentiment has prompted all stakeholders to become active in the market. Consequently, prices moved up by Rs. 20-30 a kg last week. Quality of the capsules arriving were not up to the mark and there was a shrinkage in supply. Arrivals last week stood at 295 tonnes as against 390 tonnes the previous week. Though the south-west monsoon was declared “normal” last year after two consecutive years of drought, the cardamom growing areas received poor rains. Cardamom farmers say the monsoon was very bad and about 50 per cent deficient. A failed north-east monsoon also added to the crop worry. The farmers say that last year they received just about 10 per cent rains compared to what they used to get normally during the north-east monsoon. The yields are thus likely to take a hit and are expected to be just 30 per cent of last year’s. Prices are expected to remain high as cardamom enters its lean season which is between February and May when the supply comes down. Technically market is under fresh buying as market has witnessed gain in open interest by 1.91% to settled at 852 while prices up 18.5 rupees, now Cardamom is getting support at 1375.4 and below same could see a test of 1361.2 level, And resistance is now likely to be seen at 1398.4, a move above could see prices testing 1407.2.

Trading Ideas:

# Cardamom trading range for the day is 1361.2-1407.2.

# Cardamom prices gained on good buying amid a squeeze in supply at auctions held in Kerala and Tamil Nadu.

# Arrivals last week stood at 295 tonnes as against 390 tonnes the previous week.

# Quality of the capsules arriving were not up to the mark and there was a shrinkage in supply.

# Cardamom prices in spot market dropped by 12.80 rupees and settled at 1442.20 rupees.