India: Turmeric prices strengthen despite higher arrivals as spot demand rises

• Stocks remain stable despite 8% rise in arrivals
• Oct, Dec futures strengthen on fresh long buildup

India’s turmeric market strengthened during the week ended October 2, with spot and futures prices rising despite higher arrivals. The BigMint ex-Nizamabad turmeric benchmark increased 1.1% w-o-w to INR 20,158/quintal (qtl) from INR 19,933/qtl, while the ex-Sangli benchmark rose 1.2% to INR 22,545/qtl from INR 22,282/qtl. Spot prices at Sangli and Nizamabad gained 2.7% and 2.5%, respectively, indicating firm buying interest despite increased physical availability.

Spot market absorbs higher arrivals

Sangli spot turmeric prices rose 2.7% w-o-w to INR 23,400/qtl from INR 22,791/qtl, while Nizamabad prices increased 2.5% to INR 20,729/qtl from INR 20,223/qtl.

Arrivals increased 8% w-o-w to 3,100 t from 2,870 tonnes (t). Despite the increase in physical availability, prices strengthened, suggesting that buying interest has been sufficient to absorb the additional supply. The price response indicates that higher arrivals have not yet translated into significant supply pressure.

Futures indicate fresh long buildup

October turmeric futures rose 3.6% w-o-w to INR 21,490/qtl from INR 20,750/qtl, while open interest (OI) increased 4.6% to 38,565 t from 36,855. The simultaneous rise in price and OI indicates fresh long buildup.

December futures gained 3.2% to INR 21,760/qtl from INR 21,096/qtl, while OI jumped 72.8% to 5,425 t from 3,140. The combination of higher prices and OI also indicates fresh long buildup, while the sharper increase in December OI points to growing participation in the later contract.

Stocks remain broadly stable

Total stocks across Erode, Nizamabad, Sangli and Basmat increased marginally to around 20,225 t from 20,187 t, up 0.2% w-o-w.

Nizamabad stocks declined to 3,704 t from 3,738 t, while Sangli stocks fell to 6,957 t from 7,362 t. Basmat stocks increased to 8,828 t from 8,351 t, while Erode stocks remained unchanged at 736 t.

The near-stable aggregate stock position, despite higher arrivals, provides limited evidence of a significant buildup in marketable supply.

Outlook

Turmeric prices are likely to maintain a firm undertone in the near term, supported by stronger spot prices and fresh long buildup in both October and December futures. However, the 8% rise in arrivals remains a key factor to monitor. If arrivals continue to increase without a corresponding improvement in demand, upside momentum could moderate. Sustained buying interest will therefore be crucial for prices to extend gains.