Turmeric Gains Supported By Reduced Supplies In The Spot Market.

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Turmeric Gains Supported By Reduced Supplies In The Spot Market.

Turmeric prices surged by 5.99% to settle at 16604, primarily driven by reduced supplies in the spot market. Despite this bullish momentum, buying activities have been somewhat subdued as market participants await the release of stocks ahead of the commencement of new crops. The delayed harvesting of new crops, coupled with tighter ending stocks, is anticipated to maintain upward pressure on turmeric prices in the near term. However, the upside potential is perceived as limited due to slower buying activities and the expectation of increased supply. Moreover, the pressure on prices is exacerbated by the improved crop condition resulting from favourable weather conditions, albeit with concerns over the location of PM Modi's Turmeric Board in Telangana sparking farmer concerns in Maharashtra. 

The anticipation of a 20–25% decline in turmeric seeding this year, particularly in key areas like Maharashtra, Tamil Nadu (NS: TNNP ), Andhra Pradesh, and Telangana, underscores shifting priorities among farmers. This decline in seeding could potentially impact future supply dynamics and market sentiment. Conversely, turmeric imports in December 2023 showed a month-on-month decrease but a significant year-on-year increase, reflecting fluctuating demand-supply dynamics in the global market. 

From a technical perspective, the market is experiencing fresh buying interest, as evidenced by the increase in open interest by 0.03% alongside a substantial price increase of 938 rupees. Support levels for turmeric are identified at 16072, with a potential test of 15540 levels if breached. On the upside, resistance is expected at 16870, with a breakout potentially leading to a test of 17136 levels.

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