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| Friday, 6 February 2004 |
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Local coffee prices not affected by international trend by Steve A. Morrell World trade centres were concerned that coffee prices have not shown an appreciable change and have remained at the rupee equivalent of 30-35 per kilo for the past few months. However, local prices have not been influenced by international trends and have continued to sell at viable price levels which stood at Rs. 50 - Rs. 55 per kilo, said M.C.M. Zarook of Spices and Allied Products Producers' Association. (SAPPTA). In a bi-weekly sales resume he said that although cinnamon remained at the static Rs. 510 level a change was expected in the near future because of increased world demand. Causes for demand could be attributed to more players opting for value added products at production points which have had international acceptance. Cloves which sold at Rs. 285 per kilo early January saw a 100 per cent increase. Prices at local auctions recorded sales of Rs. 435 per kilo. The leap forward was attributed to strong buying interest from India. The market has now levelled off at Rs. 375 and would remain at that level short term. Indian cropping patterns for most spices have affected local prices and the salutary aspects of crop failures there have boosted sales at the Colombo auctions. Farmers could be content that this trend would continue till the inter-monsoonal rains expected early March. Hold back stockpiles if released now may realise firm prices based on the assumption that the market would continue to be strong. Pepper closed at Rs. 165 per kilo end January, up from Rs. 135 early 2004. Cocoa and nutmeg too moved up 40% and the latest prices were Rs. 160 and Rs. 220. Cinnamon remained steady at Rs. 510 per kilo. Although export volumes for cardamom were disappointing quantity arrivals at the Colombo auctions were encouraging. Prices were maintained at or around the 1,500 range. The trade is now awaiting the initial crop inflows of the new planted material called 'Green gold' which is expected to dominate the market. The spice sector continues to be viable and as a steady long term investment expected returns would not be disappointing. The sector exported 25,895 metric tones last year with foreign exchange earnings of Rs. 9 billion. Roundup of the spice Trade submitted by the Business Chamber of Commerce in its analysis submitted recently confirmed that export volumes would continue to bring in valuable foreign exchange which would encourage farmers to expand their planted acreage progressively. The newest addition to the spice collection for export is Vanilla. Experts have said that weather conditions in certain parts of the island are just right for this crop. Sources said that already two approved BOI projects commenced in the Kandy district. The Vanilla vine takes about three years to produce blooms, and demands intensive cultural and harvesting practices and are confident these demands could be met. The crop is expected to further boost exports. The reported planted area under this crop is around 40,000 hectares worldwide produced by about 10 to 12 countries. The large producers, according to SAPPTA are Madagascar, The Comoros and Zimbabwe. Vanilla is at present selling at US$300-350 per kilo. |
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