JEERAJEERA Reaching New Heights

Kishore NarneKishore Narne

7 Oct 2006

Introduction

Botanical Name: Cuminum cyminum.

Variety: S-404, MC-43. Gujarat Cumin-1(GC-1), GC-2, GC-

3, RS-1, UC-198, RZ-19, etc

Sowing time: It is a rabi crop sown in October –

November

Harvested in February

Jeera requires moderate rainfall for its growth

110 to 115 days depending on variety

Uses

As culinary spice

Used in beverages

Ayurvedic Medicines

Biscuits, Confectionery and other spicy products

Also used in different industries for its essential oil

Where it is produced

Global Scenario

India and Egypt are the largest cumin production regions

Also produced in Iran, Syria and Turkey but only for exports

Both whole seeds and powdered seeds are internationally

traded

Cumin essential oil is also becoming popular in the western

hemisphere

The global consumption of cumin seeds is quite low, except

in India and Middle east

Indian Scenario

India is the largest producer and consumer of cumin

The annual production ranged between 1.5 lakh metric tonnes to 2 lakh metric tonnes

Rajasthan and Gujarat are the main producing States

Significant percentage of the total production is used for domestic consumption

Exported to Japan, Brazil, US, UK, UAE etc.

Outlook

Production, Area and YieldJeera

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

1975-76 1985-86 1991-92 1993-94 1995-96 1997-98 1999-00 2001-02 2003-04 2005-06 (E)

Year

Hec

tare

s / T

on

s

0

100

200

300

400

500

600Area Output Yield

Figures at a glance

ParticularParticular

Quantity (lakh Quantity (lakh bags) bags)

1bag=40 to 60 1bag=40 to 60 kgkg

Production in 2005-2006 17-20

Carry over stock 7-8

Total 28

Export till September 2

Balance Remain 26

Domestic consumption 15-20

Stock available for next year 6-7

Expected Export in coming days 2

Macro Scenario

Production Estimates for current year

– Syria: 25 thousand tonnes (25% less then last year)

– Turkey:  12-14 thousand tonnes (6% less than last year)

– Iran: 50 thousand quintal (50% less as compare to last

year)

Turkey and Syria Inferior in Quality

Major producer India, Production down by 40%

No fresh arrivals in line for the next 6 months

Lower carry over

India

Currently witnessing a relief rally

Festive Demand

Sowing activity picking up

Ample soil moisture levels in Gujarat

Current prices very attractive for farmers

Technicals - DailyDaily QNJEc1 5/27/2006 - 10/12/2006 (BOM)

Cndl, QNJEc1, 10/6/2006, 7,725, 7,799, 7,416, 7,440SMA, QNJEc1, 10/6/2006, 8,123.4SMA, QNJEc1, 10/6/2006, 8,390.04

Price

INR

Kg

.##

6,300

6,600

6,900

7,200

7,500

7,800

8,100

8,400

RSI, QNJEc1, 10/6/2006, 14.36 Value

INR

Kg

.##

20

40

60

29 05 12 19 26 03 10 17 24 31 07 14 21 28 04 11 18 25 03 09

June 2006 July 2006 August 2006 September 2006 Oct 06

WeeklyWeekly QNJEc1 2/6/2005 - 11/5/2006 (BOM)

Cndl, QNJEc1, 10/8/2006, 8,255, 8,359, 7,416, 7,440SMA, QNJEc1, 10/8/2006, 8,247.52SMA, QNJEc1, 10/8/2006, 7,591.18

Price

INR

Kg

.##

5,500

6,000

6,500

7,000

7,500

8,000

RSI, QNJEc1, 10/8/2006, 41.78 Value

INR

Kg

.##

20

40

60

Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct

Q1 2005 Q2 2005 Q3 2005 Q4 2005 Q1 2006 Q2 2006 Q3 2006 Q4 2006

Outlook

Short term – Over Sold

– Festive Demand

– Quality Specifications on the Exchange

– Technical Pullback

Outlook

Medium – Long Term : Bearish

– Valuations are stretched

– Turkey Prices @ $1950 where as India prices are $2250

– Crop is expected to be huge

– Acreage expected to see a sharp raise

– If the whether conditions remains favorable expect a raise

of 50-60% in acreage

– We expect the prices to go beyond Rs.6500/qtl by Feb-Mar

‘07

Risk Factors

At this point of the year the Temperatures in Gujarat should be below 30o C but currently are at 39oC

There should not the rain fall with winds towards end of October

If the rains destroy the crop towards end of October then the prices may sustain above Rs.8000-9000/Qtl

Thank YouThank YouThank YouThank You