Chilli prices lose spice over low demand
Chilli prices are on the weaker side due to a sluggish demand for the commodity. Reports of lower sowing in the current season have not affected the market due to the good carryover stocks in the cold storages and terminal market. India is the leading producer of chilli, contributing close to 45 % of the global production with an annual production of 13-14 lakh tonne. “Chilli farming area is lower this season due to poor returns. Many farmers lost money and they have reduced their exposure to chilli. In Andhra Pradesh, the sown area is lower by 30% while in Karnataka it is lower by almost 50 % when compared to the last season,” chilli trader Peraiah Ravipati from Bellary told FE. Kotak Commodity Services reported that chilli sowing is 40.14% lower compared to last year and there are 55 lakh bags of red chilli in Andhra Pradesh cold storages. “Chilli is facing an overall weak market due to lower exports, good stocks and sluggish domestic demand,” Faiyaz Hudani at Kotak Commodity Services said. He expects the market to go down further as the new crop comes to the market. On Wednesday, the spot market at Guntur recorded R5,400 for one quintal of chilli. “Demand is not encouraging at this level and it is likely to increase only at lower price levels,” he added.