Chilli prices are likely to move up in the coming days due to good domestic and export demand, traders said on Wednesday.
Prices are estimated to increase 8-10 % in the near-term on demand and quality concerns on the old crop.
India is the leading producer of chilli, contributing close to 45 % globally with an annual production of 13-14 lakh tonnes.
“Currently the demand is sluggish in both the domestic and export sectors. But we expect it to pick up in the coming days. Neighboring countries like Bangladesh is buying, but the volume is not good when compared to last year. Exports are expected to improve in the near-term,” Naval Khaitan, a prominent trader and exporter from Guntur told FE.
Faiyaz Hudani at Kotak Commodity Services feels export would be a key factor in the pricing of the commodity.
“All agro-spices have picked up in the last one month including chilli. But for chilli to sustain the good run, good exports are a must,” he said and added that trade sources estimate exports of chilli during the fiscal to be good.
Higher exports always translate into higher domestic prices due to the lesser availability of the commodity.
Kotak Commodity Services said chilli sowing is 40.14% lower compared to last year and the there are 55 lakh bags of red chilli in Andhra Pradesh cold storages.