Brochures Spices

7/27/2019 Brochures Spices

1/8

SPICES COMPLEX


2/82

Spices form an important ingredient of Indian cuisine. The delightful combination of the variety of spices lends a distinctive

spices futures on its platform for managing price risk and providing an alternative investment avenue. Chilli, Coriander,

Jeera, Pepper and Turmeric constitute NCDEXs spice complex for derivatives trading. The performance of these contracts

India is the leading producer, consumer and exporter of spices in the world. From time immemorial India has been known

as the Land of Spices. The Chinese, Arabs and The Europeans came to the Indian shores lured by the spices grown here. The

world consumption of spices is growing steadily year on year and trading in Spices Futures has also grown from strength to

You can trade in Spices futures by either becoming a member of NCDEX or a client of one of the member

of the Exchange.

RPEPPE

APRIL 2004

TURMERIC

JULY 2004

JEERA

FEBRURY

2005

CHILLI

MARCH

2005

CORIANDER

AUGUST

2008

F

Import/Export Data

D

are used in the dry, fresh and powder forms and are also used to make oleoresin.

spices are used as a agent for culinary purposes and form an important ingredient

powders are used as colouring agent for processed foods

Global and Domestic Production /Demand

Total Deposited Stock & FED wise stock positionClimatic conditions

Daily Arrivals and trades in the cash market

International Price parity

Year ending stocks and stocks-to-consumption ratio

Prices received by farmers for other competing crops & Sowing progress

Cost of Carry components (Warehousing, Assaying, Demat/Remat charges)

Spot Prices

Daily Margins

Spices

All

of curry powders and Indian recipes.

Spice

Spices are being extensively used in medical, Pharmaceutical, Cosmetics & Food ProcessingIndustries.

RPEPPE

APRIL 2004

TURMERIC

JULY 2004

JEERA

FEBRURY

2005

CHILLI

MARCH

2005

CORIANDER

AUGUST

2008

SPICESSPICES


3/8

3

KNOWLEDGE EDGE

Plantation- Harvest Calendar: India

Spices Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec

RED CHILLI

CORIANDER

JEERA

PEPPER

TURMERIC

Harvest Planting Flowering

The Plantation - Harvest Season may changed due to change in climatic conditions.

SPICE UP YOUR INVESTMENT PORTFOLIO

SPICES FUTURES AS A TOOL TO MANAGE PRICE RISK

PRICE VOLATILITY

(

EXPORT

APR-JUN

FROM I

2011) T

NDIA

NNES

0

3

6

9

12

15

18

21

24

Jan-09

Mar-09

May-09

Jul-09

Sep-09

Nov-09

Jan-10

Mar-10

May-10

Jul-10

Sep-10

Nov-10

Jan-11

Mar-11

May-11

Jul-11

DHANIYA PEPPER TURMERIC JEERA CHILLI

Source: NCDEX (Monthly volatlity calculated on the basis of spot prices of base centre

Best

Performing

LongBest

Performing

Short

0

10

20

30

40

50

Coriander Turmeric

Top Performing Spices

Returns in Jan-July 2011 (%): Near Month FuturesCHIL

TURM

CU

CORIA

PEP

LI - 40,5

RIC - 21,

IN - 5,7

DER - 7,

ER - 5,7

0

775

0

500

0


4/84

Coriander (Dhaniya) (Market size 1100 Crores, HS Code 090920)

Coriander, an annual rabi crop of the country is sown around

About 80% of the production in India comes from Rajasthan.

The other major producing states are Madhya Pradesh, Andhra

Pradesh and Orissa. The Total Domestic production of the crop

is around 2.5-3.00 lakh tonnes. Indonesia, Sri lanka,UAE, Saudi

Arabia, USA, UK, Germany and the Netherlands are the major

importers whereas India, Turkey, Egypt, Romania, Morocco, Iran

and China are chief exporters. Popular grades of the rounded

seed spice on the basis of colour are Badami, Eagle, Scooter

and Parrot. Major trading centres of this spice include Kota, Ramganj, Baran and Jaipur in Rajasthan, Guna in

Madhya Pradesh and Virudnagar in Tamilnadu. India is the largest producer, consumer and exporter of coriander.

Chilli (Mirchi) (Market size 6954 Crores, HS Code 09042010)

chilli

and

Cumin seed (Jeera) (Market Size 2050 Crores, HS Code 090930)

Gujarat is the largest jeera producing state in the country,

followed by Rajasthan. These two states alone contribute

approximately 90% of production in the country. India leads the

world production with around 2.0 lakh MT of Jeera produced

annually and harvesting session of the crop is from February

- April. Most of the Jeera produced is consumed within the

country. Although Syria, Turkey and Iran have a much lower

level of production as compared to India, but these countries

SPICES @ NCDEXSPICES @ NCDEX


5/85

prices as a bulk of their production is used for export purpose. Indian cumin is exported to many countries in its natural

as well as powdered form, besides as an essential oil. The export of cumin seeds from India has increased manifold in the

Turmeric (Haldi) (Market Size 5758 Crores, HS Code 091030)

Indian turmeric is considered to be the best in the world due

to presence of high curcumin content. There are wide uses

of this golden spice. Apart from its domestic culinary use, it

processed foods. Turmeric is also an important ingredient in

cosmetics as well as in the pharmaceutical industry. It is mainly

cultivated in Andhra Pradesh, Tamil Nadu, Maharashtra, Orissa

and West Bengal, with production ranging from 5.5-8.0 lakh

tonnes and harvesting session is from February to April. The

spice is generally available as Fingers and Bulbs. Some of

the well known varieties of turmeric are Salem and Erode

turmeric (from Tamil Nadu), Rajapore and Desi Cuddapah

turmeric (from Maharashtra) and Nizamabad turmeric Duggirala turmeric, Cuddapah turmeric and Warangal turmeric

(from Andhra Pradesh).

India is the largest producer, consumer and exporter of turmeric across the globe. The other major producers are China,

Myanmar, Nigeria, Bangladesh, Pakistan, Sri Lanka, Taiwan, Burma and Indonesia.

Pepper (Kalimirch) - (Market Size 803 Crores, HS Code 09041130)

Black pepper is often referred to as black gold among spices.

Pepper berries are usually dried and used as spice and

seasoning. Black pepper is used directly as spice and also for

the preparation of oleoresin and oil. Pepper grades in trade

grades are Malabar and Tellicherry. In addition to these two

Indian varieties, the major varieties traded in the world include

Lampung, Brazilian, Ceylon, Sarawak and Vietnam.

Vietnam with an annual production of almost double that of

India, has now become one of the major suppliers of pepper

in the international markets. However, Indian pepper fetches a

premium price in major markets because of its preference and

,

intrinsic qualities. India, Brazil, China, Indonesia, Malaysia, Sri Lanka, Thailand and Vietnam are major players in pepper

production and exports. June-July is the harvesting period in Sarawak (Malaysia), August- September in Brazil, July-

September in Lampung (Indonesia) and January-February in India. World Pepper production varies from 2.7 lakh-3.6

lakh MT per annum whereas Indian production varies from 45,000 to 50,000 MT. Kerala is the leading state producing

black pepper in India.

last ve years. Jeera or cumin seed has signicant demand as a spice all around the globe especially in the places where

spicy food is preferred.


6/8

SPICES FUTURES CONTRACTS SPECIFICATIONS

Compulsory delivery of contracts implies that all open position at the expiry of contract need to be settled

www.ncdex.com.

JEERA PEPPER TURMERIC

Ticker Symbol JEERAUNJHA PPRMLGKOC TMCFGRNZM

Unit

of

Trading

3

MT 1

MT 5

MT

Delivery

Unit

3

MT 1

MT 5

MT

Quotation

Base

Value /quintal* /quintal* /quintal* /quintal*

Tick Size Re. 1 Re. 1 Re. 2

Basis Centre Unjha Kochi Nizamabad

Additional Delivery Centres

Delhi, Jaipur,

Jodhpur

Calicut, Trissur

Erode, Sangli,Warangal,

Duggirala,Cuddapah

GradeMachine Clean

Jeera

Malabar

Garbled- 1

Unpolished

Finger

Members

Position

Limit (MT)

All Contracts

3000

(600)

4500

(900)

20000

(4000)

1000

(200)

1500

(300)

5000

(1000)

Delivery Logic

ERCORIAND

DHANIYA

10 MT

10 MT

/quintal*

Re. 1

Kota

Ramganj Mandi,

Jaipur, Guna,

Baran

Badami

7500

(1500)

2500

(500)

Compulsory

Delivery

CHILLI

CHLL334GTR

5 MT

5 MT

Re. 2

Guntur

Warangal

LCA 334

12500

(2500)

4000

(800)

Compulsory

Delivery

Compulsory

Delivery

Compulsory

Delivery (EarlyDelivery)

Compulsory

Delivery

6

(* : quintal=100 Kgs)

Near Month

All Contracts

Near Month

Clients

Position

Limit (MT)

Maximum Order Size 150 MT 50 MT 250 MT500 MT250 MT

Parameter

VALUE CHAIN: ALL PARTICIPANTS IN THE VALUE CHAIN FACE THE PRICE RISK

Farmer

Commission Agent orKachcha Adatia

Consumer

Trader orPakka adatia

Retailer

Processor/Exporter

Wholesaler


7/87

MAJOR AREAS OF SPICES PRODUCTIONMAJOR AREAS OF SPICES PRODUCTION


8/8

Contact our Business Team (Spices) for any query/information:

SRIKANT AMBATI (HYDERABAD) + 919951922000 ANUP RAJ (DELHI) +919958110086

JITENDRA SINGH (JAIPUR) +919983325699 VIKRAM SINGH (KOLKATA) +919051454777

SREEKANTH CHETTIYAR (KOCHIN) +919946761411 SANDEEP DUBEY (HYDERABAD) +919949152475ANIL JAISWAL (AHMEDABAD) +919898066934 BHARAT JAKATI (MUMBAI) +919833255348

DEEPAK SAYANA (HYDERABAD) +919848220310 TARUN KATOCH (INDORE) +919754417054

Sugandh Exporters has an export commit-

ment of 30 M T of Jeera for delivery in Decem-

ber 2011 contracted at `15,500 per quintal.

The exporter faces the risk of jeera pricesgoing up. As soon as he enters into export

contract, he buys 10 contracts of December

2011 expiry Jeera futures at existing price of

15,000 per quintal. In the month of December,

price of jeera in spot market (as well as in

futures on expiry) becomes `16000 per quin-

tal. He incurs a loss of `500 per quintal in

meeting the export obligation but gains

`1000 per quintal in futures market. Thus, he

manages to hedge from adverse price risk by

taking corresponding positions in futuresmarket.

Hedging

Cash & Carry Arbitrage

Speculation

8

Ms. Mirchi has through understanding of the

fundamentals of chilli trade and keeps a

continuous track of domestic and internation-

all developments that aect the price of chilli.In the Present scenario, she is convinced that

the price of chilli is likely to increase in coming

months. She takes a long position by buying 5

futures contracts of NCDEX chilli for far month

at `9,000 per quintal. In few days, the price

increases to `10,000 per quintal and she

squares o her position and locks in the prof-

its.

GAURAV MIDDHA (DELHI) +919711159060 T. UMESH (JAIPUR) +918239101000

TRADING STRATEGIESTRADING STRATEGIES

Tikharam has no direct exposure to dhaniya

trade; however, he has interest in commodity

investment. He nds out that dhaniya decem-ber 2011 futures are trading at `6000 per quin-

tal and current spot price is `5200 per quintal.

He noticed that after accounting for cost of

carry (assaying, storage, interest etc), his cost to

deliver in december is around `5900 per quin-

tal. He procures 10 MT from local mandi today

and deposit it in NCDEX accredited warehouse.

At the same time, he sells 1 dhaniya futures

contract of december expiry on NCDEX. At

expiry, Tikharam delivers dhaniya and realises

the prot of`10,000.

Swadumal is a keen observer of futures price of

pepper traded at NCDEX. From his experience

over the years, he knows that normally the

prices of January expiry contract exceeds thatof December contract by around `500.This

dierence is called 'spread' in trade terminol-

ogy. Due to some uctuation in market, this

spread shrinks to `300. Swadumal believes that

eventually the spread will resume normalcy

and increase to around `500. He, therefore,

buys 1 contracts of january Pepper and shorts 1

contracts of December pepper. In a few days,

spread widens to `450. He squares o his posi-

tion in both the contract and realises the prot

of` 1,500.

AMIT DARAK (MUMBAI) +919819179128

Brochures Spices

Documents

Transcript of Brochures Spices