Vacation Might Provide A Break

Summer vacations in Guntur, the largest red chilli market in India, starting from May 11, potentially pausing the recent market slump. Business sources in Guntur have indicated that the upcoming holidays might provide a much-needed break from the ongoing downturn in red chilli prices. The local wholesale grocery market has seen sluggish buying, keeping the price of number 334 red chilli stable at $2,40 to $2,46 per kg, even after a recent drop of $12.

Market Conditions and Trading Challenges

The quality of red chilli in the markets of Andhra Pradesh and Telangana is reportedly lighter than usual, contributing to the market's sluggishness. Jugraj Bhandari, a Guntur-based businessman, mentioned that intense heat in the region has made trading especially difficult for merchants. Consequently, trading will cease on May 10, leading into a month-long break starting May 11. The market is expected to normalize when business resumes on June 10.

Pricing Trends and Export Performance

• Despite lighter quality affecting prices, the number 334 has maintained its previous price range of $1,56 to $2,04 per kg.
• Similarly, Teja red chilli prices have stabilized at $1,92 to $2,28 per kg,.
• Number 341 has remained at $1,68 to $1,98 per kg.
• In contrast, ground red chillies saw a price increase of $0,72 to $1,44 per kg.

Meanwhile, in Warangal Mandi of Telangana, hot red chilli and Pattaki varieties have shown similar pricing patterns.

Export Growth Amid Market Challenges

According to data from the Spices Board, red chilli exports from India have grown in the first ten months of the financial year 2023-24. From April 2023 to January 2024, India exported 425,199 tonnes of red chilli, generating a revenue of approximately $104.88 million, up from 378,183 tonnes worth $91,81 million in the same period the previous year. This increase in exports highlights the global demand for Indian red chillies despite domestic market fluctuations.

Future Outlook: Anticipating Market Recovery

As the Guntur market prepares for a month-long hiatus, industry experts are hopeful that this break will mitigate the current recession in red chilli prices. The vacation period is expected to affect arrivals significantly, potentially leading to a shift in market dynamics upon resumption. Business sources remain optimistic that the post-vacation period will bring stability and possibly an uptick in the red chilli market as activities normalize.