MCX_English_Cardamom_180613.pdf

8/9/2019 MCX_English_Cardamom_180613.pdf

http://slidepdf.com/reader/full/mcxenglishcardamom180613pdf 1/4

INTRODUCTION

APPLICATIONS

GLOBAL SCENARIO - DEMAND AND SUPPLY

INDIAN SCENARIO - DEMAND AND SUPPLY

Cardamom is known as the “Queen of Spices”. It is one of the most highly priced and exotic spices in theworld. It is a perennial tropical herb plant belonging to the ginger family (Zingibaraceae) and grows from athick rootstalk up to around 6-10 feet. It is indigenously grown in the evergreen forests of the Western Ghatsin South India.

The commercial part of cardamom is the fruit (capsule) of the plant that is used as a spice and a flavoringagent. It is considered to be a versatile spice, as it is used in both sweet and salty foods. Oil from the seedsand the leftover resin have their usage in processed foods, tonics, liquors and perfumes. The fruit also findssignificant usage in Ayurvedic medicines for dental infections, digestive disorders, etc., as it has healingproperties.

Till 2000, India used to be the largest producer of Cardamom, and thereafter, Guatemala pushed her to thesecond position. Cardamom cultivation is concentrated on the Western Ghats in the country; and the WesternGhats are also known as “Cardamom Hills”. In 2012-13, as per provisional trade estimates, India's production isaround 12,000 MT.

Following states are the major producers of cardamom in India:

1. Kerala – 70%2. Karnataka – 20%

3. Tamil Nadu – 10%Idukki district in Kerala is the major cardamom-producing area and places such as Udumbanchola taluka,Peermede taluka and Devikulam taluka are important centres in Idukki district.

Cardamom is traded as a bulk and graded produce. Cardamom is graded by using sieve and fetches differentprices based on their size, colour and freshness, command varied prices. The 7-mm and above grade withfancy green colour commands a premium over other grades.

Cardamom finds its place in every kitchen in the world. Cardamom goes into tea, coffee, snacks, sweet dishes,rice preparations, soft drinks - almost all favorite food items of the world. Guatemala produces around 25,000MT yearly, the largest in the world, accounting for almost 66% of the total global production.

Cardamom is generally produced in the tropical regions of the world. Gautemala is the largest cardamomproducing country followed by India. The total world production of this spice is around 35,000 MT per annum(source: Spices Board). Consumption of cardamom has sharply increased throughout the world during the lasttwo decades. The major consuming countries of cardamom are the Middle Eastern countries, India, Pakistan,European countries, the US, and Japan. Middle Eastern countries such as Saudi Arabia and the United ArabEmirates, and South-East Asian countries such as India, etc., account for more than 60% of the world'sconsumption.Saudi Arabia is the single largest importer of Cardamom in the world, followed by Kuwait. The list of countries / territories that are the major importers is as follows:1. Saudi Arabia | 2. Kuwait | 3. UAE | 4. USA | 5. Japan | 6. Pakistan | 7. U.K | 8. Malaysia | 9. Israel | 10. Australia11. Canada | 12. South Africa

RD MOMCARDAMOM

The Multi Commodity Exchange of India Limited (MCX) is a state-of-the-art, demutualised, electroniccommodity futures exchange that facilitates online trading, and clearing and settlement of commodityfutures transactions, providing a platform for risk management. MCX offers trading in more than 40commodity futures contracts across segments including bullion, ferrous and non-ferrous metals, energy,agricultural and agri-based commodities.

MCX is aleading

commodityexchange inIndia, with a

market share of87%*

(Q3 FY 2012-13)*In terms of the value of commodity

futures contracts traded(Source: Data maintained by FMC)

For private circulation only



www.mcxindia.com

Globally, MCX isNo.1 in goldand silver,

No.2 innatural gas,and No.3 incrude oil*

*In terms of the number ofcommodity futures contracts

traded during CY 2011(Source: Websites of exchanges

and FIA data)

Spices Board on Cardamom production is as follows:

India consumes almost 90% of the domestic production with almost 45% of the demand coming from thewestern part of the country followed by the northern India with 35%. As India's production is capable ofsatisfying the domestic consumption demand, it does not import any cardamom from outside countries.However, cheaper Guatemalan cardamom finds its way into the country and is preferred for low value useslike pan masala. The leftover cardamom produce is exported every year. India exports 5-8% of its totalproduction, mostly the premium grade. India also exports by-products of cardamom such as cardamom oiland oleoresins to European countries.

Following are the major countries that import cardamom and its by-products from India:1. Saudi Arabia | 2. Kuwait | 3. UAE | 4. USA | 5. Japan

Saudi Arabia is the largest market for Indian cardamom with a share of around 60% followed by Kuwait, UAEand USA. Guatemala reduces India's export market competitiveness by providing cardamom at cheaper ratesowing to the nation's high productivity.

INDIAN SCENARIO – PRODUCTION & CONSUMPTION

724

102

62

4026

3318 21 16 11 9

SAUDI ARABIA

KUWAIT

UAE

USA

JAPAN

PAKISTAN

U.K

MALAYSIA

AUSTRALIA

CANADA

SOUTH AFRICA

Export of small cardamom from India

Qty(MT) Value ( ` Lakh)2006 07 655 2348.1

2007 08 500 2475

2008 09 750 4726.492009 10 1975 16570.142010 11 1175 13216.66

–

–

–––

Source: Spices Board

India production small cardamom

Area (Hectares) Production (MT)2007 – 08 69300 9450

2008 – 09 71170 110002009 – 10* 71110 10075

2010 – 11(adv.est.) 71012 103802011 12(*) 71110 12975–

(*) midterm estimateSource: Spices Board



www.mcxindia.com

Source: Bloomberg

MCX reachesout to over

1,770 cities andtowns in India

through3,46,000+

tradingterminals(including CTCL)

(as of Q3 FY 2012-13)

FACTORS INFLUENCING PRICE OF CARDAMOM

MAJOR TRADING CENTRES

BENEFITS OF TRADING ON MCX

= Freshness, colour, aroma and size

= Production in competing countries such as Guatemala= Annual production in India= Seasonal variations and time of arrival of the crop in the market= Weather conditions in India= Domestic festival demand

= Vandanmedu (Kerala)= Bodinayakanur (Tamil Nadu)= Kumily ( Kerala)= Nedumkandom (Kerala)= Puliyanmala (Kerala)= Mumbai= Delhi= Kanpur

The MCX Cardamom futures contract is one of the most liquid contracts on the Exchange based oncompulsory delivery. As the cardamom crop is highly sensitive to weather, and subject to high pricefluctuation, the contract can be effectively used by the cardamom value chain – growers, planters, traders,exporters, and even retailers to hedge price risks.With production being centred in South India, whereas consumption is pan-India; and buyers are largely inNorth India. MCX platform gives excellent opportunity for buyers in North India to buy their stock requirementsitting in their office knowing the best competitive price. MCX, through its warehouse arm, NBHC, has the bestwarehouse practices ensuring quality of the crop.

OI Volume

0

5000

10000

15000

20000

25000

30000

0

2000

4000

6000

8000

10000

12000

14000

1 - M a r - 0

8

1 - M a r - 0

9

1 - M a r - 1

0

1 - M a r - 1

1

1 - M a r - 1

2

1 - M a r - 1

3

O p e n

I n t e r e s t

V o

l u m e

Cardamom Volume and OI since 2008



www.mcxindia.com

IMPORTANT WEB SITES

www.indianspices.com

The underlier of the MCX Cardamom contract is Elettaria cardamom, also known as small greencardamom, grown in the southern states of Kerala, Tamil Nadu and Karnataka. Amomum cardamom,also known as black cardamom grown in North Eastern states is not tradable on the MCX platform.

Symbol CARDAMOMDescription CARDAMOMMMYY Trading period Monday through Saturday

# Trading session Monday to Friday: 10:00 am to 17:00Saturday:10:00 am to 14:00

Contract listing As per contract launch calendarExpiry date Last day of the contract month Trading unit 100 kg (1 quintal)

Quotation/base value ` / kg Tick size 10 paise per kgMaximum order size 5000 kg (50 quintals)Daily price limit Base price limit is 3%. Relaxation will be allowed upto 4%Initial margin Minimum 5% or based on SPAN, whichever is higherAdditional and/or In case of additional volatility, an additional margin (on both buy side andSpecial margin side) and/or special margin (on either buy side or sell side) at such

percentage, as deemed fit, will be imposed in respect of all outstanding

positions.Maximum allowable For individual clients: 160 MT;

For a member : 800 MT or 15% of the market-wide open position, whicheveris higher.Near Month Limits

For individual clients: 40 MT;

For a member : For a member collectively for all clients: 200 MT or 15% ofthe market-wide open position, whichever is higher

Delivery logic CompulsoryDelivery center At exchange designated warehouse at Vandanmedu in Idukki Dist of Kerala

State; and exchange designated Cold Storage within 50 km radius ofBodinayakanur in Madurai District of Tamil Nadu State

Delivery unit 100 Kg, and direct multiples thereof.

Note: Please refer to the exchange circulars for the latest contract specifications and delivery and settlementprocedures.

CONTRACT SPECIFICATIONS OF CARDAMOM

Open position

#: Day light timing 10:00 to 17:00 (Winter)

1 8 0 6 1 3

Multi commodity Exchange India LimitedExchange Square, Suren Road, Chakala, Andheri (East), Mumbai 400 093 | Tel. no.: +91-22-6731 8888 | Email: [email protected] | Website: www.mcxindia.com

Customer Support: +91-22-6649 4040 | To get the latest futures prices on mobile: visit http://m.mcxindia.com or sms “MCX <Commodity name >” to 58888

MCX is the firstcommodityexchange in

India to launchmini futurescontracts in

variouscommodities

Documents

MCX_English_Cardamom_180613.pdf