Turmeric Dropped On Profit Booking

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Turmeric Dropped On Profit Booking

Turmeric prices saw a slight decline of -0.6% to settle at 17,880, largely driven by profit booking after recent gains, despite ongoing concerns about supply shortages. Farmers are holding back stocks in anticipation of further price increases, while the current heat wave across India threatens to damage crop yields, exacerbating the supply crunch and supporting prices. However, any relief from the hot weather seems unlikely, with the India Meteorological Department predicting more heat wave days than usual for May. Despite the bullish factors, profit booking and increased supplies towards the end of the harvesting season have capped the upside potential for turmeric prices. 

Rainfall in southern India was significantly below normal in April, further adding to concerns about crop yields. The Ministry of Agriculture and Farmers’ Welfare's estimate for turmeric production in 2023-24 indicates a slight decrease compared to the previous year. Additionally, demand destruction has been observed as prices surged, with many consumers adopting a hand-to-mouth approach. In terms of trade, turmeric exports during Apr-Mar 2024 declined by 4.75% compared to the previous year, while imports dropped by 12.71%. However, there was a notable increase in imports in March 2024 compared to the same period last year. 

Technically, the turmeric market is experiencing long liquidation, with a 2.91% drop in open interest to settle at 16,505, accompanied by a decrease in prices by -108 rupees. Currently, turmeric finds support at 17,556, with a potential test of 17,232 below this level, while resistance is likely at 18,252, with a possible upward movement towards 18,624.

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