MUMBAI, 2 June 2025: In the commodity business, do not be under the illusion that your prediction will always be correct, there is no certainty about when a man , monsoon and markets will change.
Talking about the cumin business itself, when the cumin trade boomed in the first week of April 2025, farmers were not ready to sell cumin even at a price of INR 25,500 per quintal, at that time they were dreaming of selling cumin at a price of INR 30,000. But after that, when the prices continued to fall and reached INR 20,660 per quintal in the last week of May, they must have realized that they had been fooled. Even If these farmers had bought put options with the condition of delivery in May 2025, they would have received a price of INR 22,500.
Now in today's scenario, farmers do not earn much, but due to the difference in prices between the spot market and the futures market, investors who trade in Cash & Carry, have earn an annual interest of 10 to 12 percent on their investments. Similarly, investors can currently earn an interest of 12 percent on the price difference between two-month futures.
Due to the impact of both local and global factors, the prices of cumin have recently fallen. There is no demand in the local markets. Statistics say that from January 1, 2025 to May 23, 2025, 244,000 tonnes of cumin arrivals have been recorded in India. Which was 210,000 tonnes in the same period last year and 136,000 tonnes in the year 2023. The indications are clear that this time the arrivals are higher than normal. Farmers are currently said to have a stock of 20 lakh bags of the product. Out of which, three to four lakh bags of the product will be sold by the end of the season.
Talking about exports, from April 2024 to March 2025, the country's cumin exports increased by 39.63 percent. But the market changed direction from March 2025. Compared to March 2024 exports, March 2025 exports saw a decline of 46 percent. Experts believe that this blow to the export trade is pushing the market towards recession. Exporters believe that India's cumin share in the global market may be 75 to 80 percent, but now the new cumin season in China will start at the end of June. This time, there are reports of good crops in China. Therefore, Chinese purchases have decreased at present. On the other hand, there are reports of damage to cumin crops in Turkey and Syria, but they cannot currently affect the Indian market. In this situation, there is little chance of a major rise in cumin prices in the near future.
Farmers are likely to benefit only if investors support this market. Because investors will be able to stock up and give farmers a chance to sell their goods. When the time for Kharif season planting is approaching, to reduce the worries of farmers, investors should provide relief to farmers by investing in cumin instead of investing in other markets. Because there are many farmers who do not have space to store their summer crops. If they are forced to sell cumin, they may suffer losses. Currently, more cumin is sold in Rajasthan's market yards than in Gujarat.
There is currently an open interest of 7500 tonnes in cumin futures. While the average daily turnover is Rs 20 to 25 crores. Therefore, there is a good opportunity to make safe profits in Cash & Carry and calendar spread deals. However, one has to keep a close eye on the market direction. Because in this market, what is there today is not there tomorrow.
By Kalpesh Sheth is an commodities expert with years of experience.
Image credit: viralspices.com
