Cardamom as a commodity traded in Indian commodity exchanges like MCX and NMCE

CARDAMOM

Description

Cardamom is a reputed fruit that grows on the cardamom plant and is used as an exquisite flavored spice all around the globe. It is considered as the �Queen of spices�, it being a highly prized spice as well. The cardamom plant is a long living tropical herb plant belonging to the ginger family Zingiberaceae and grows from a thick rootstalk up till around 6 to 10 feet. The fragrance of cardamom is also well recognized everywhere and it is used as a mouth freshener.

Cardamom plant has dark green long leaves and also a long flowering stalk and bear fruits that are pale green or yellowish in color, elongated in shape. These ripen fruits are the ones which are used as spice and flavoring agent.

Overview

Cardamom�s reputation as a spice is unmatchable as it is one of the highly priced and most expensive spices after vanilla and saffron and often termed as �Queen of spices� as mentioned above. It is considered as a versatile spice as it is used in both sweet and salty foods. Oil from the seeds of cardamom and also the left over resin have their usage in processed foods, tonics, liquors and perfumes. This fruit also has a great significance in the Ayurvedic medicines as it has got healing effects also as in teeth and gum infections, digestive disorders etc.

Cardamom as a crop is generally produced in the tropical regions of the world. The world production of this spice is around 35000 metric tons per annum. The largest cardamom producing country currently is Guatemala followed by India and Tanzania. The consumption of cardamom has sharply increased throughout the world during the last two decades. The major consuming countries of cardamom are

Saudi Arabia
India
Pakistan
United Arab Emirates
Norway
Sweden
Denmark
Finland
Iceland
Germany
Russia
England
United States
Japan

The countries in the western Asian region like Saudi Arabia, United Arab Emirates, India etc have maximum consumption and these countries share around 60% of the world�s consumption. The Scandinavian countries like Denmark, Finland, Sweden, Norway and Iceland have around 16% share in the world consumption. Rest of the European countries have a 14% share, Japan has a 3% share and USA has a 2.5% share in the world consumption.

Cardamom world market has seen many changes since it started to get traded, the most recent being the fall in the world exports. The average exports of cardamom per year stand at around 23000 tons. The major exporter countries of this famous spice are

Costa Rica
Guatemala
Indonesia
Brazil
Nigeria
India
Thailand
Nicaragua
South Africa

Costa Rica is the largest supplier of cardamom in the world. On the other hand, Saudi Arabia claims to be the single largest importer of it. Kuwait follows Saudi Arabia in the importing list but is nowhere near the leader. The major importer countries are

Saudi Arabia
Kuwait
United Arab Emirates
China
Japan
Hong Kong
Netherlands
Singapore
United States of America

History

The world doesn�t know the actual time period when cardamom originated but it is considered that the cardamom plants firstly came into existence in the monsoon forests of western ghats in southern India as wild herbs. A medicinal literature summary written in between 2nd century BC to 2nd century AD in India named Charak Samhita provides us with the first ever written inscriptions about cardamom. It says that cardamom is a significant constituent in many medicines and preparations. Some more books written in Sanskrit language of that time mentioned about cardamom being used in some rituals and ceremonies.

Greeks when initiated their exploration at this time, started importing cardamom as a digestive medicinal herb. It started to get used vastly in a number of recipes and drinks due to its heavenly flavor and fragrance. Most of the countries started to import this spice from India with the emergence of 16th century. Till 19th century, cardamom grew wild and was searched for in the monsoon forests . but the British colonies suggested the establishment of plantations and domesticated the crop. Nowadays it is grown as a secondary crop with the coffee plantations.

Uses of Cardamom

Cardamom is a multitalented and widely used spice. It encompasses variety of uses.

Cardamom is used in adding flavours in both foods and drinks.
Cardamom is used as cooking spice.
Cardamom is therapeutic in nature, broadly used to treat infections in teeth and gums, digestive disorders, throat troubles, skin conditions etc. It is considered beneficial in the treatment of sexual dysfunction like impotence and premature ejaculation.
Oil of cardamom is used in processed foods, tonics, liquor and perfumes.
In South Asia, green cardamom is largely included in traditional Indian sweets and in the making of tea.
In Arabia, Cardamom is used in the preparation of 'gahwa'- a strong cardamom coffee, which shows hospitality among Arabs.
In Northern Europe, cardamom is an essential ingredient in sweet foods.

Cultivation pattern

Cardamom is a tropical herb that takes a fairly long period to mature i.e. 2 years. It is a very climate sensitive crop and the output largely depends on it. It requires a good amount sunshine and appropriate rainfall. The soil type needed by the plant to prosper is loamy soil enriched with organic matter. Moderate shade also plays a key factor in the high cardamom yield. The propagation of cardamom plant is done through either of the 2 ways that are planting a part of the rootstalk or planting the seedling of the plant. The cardamom plant is considered matured enough to harvest when the cardamom seeds turn black or brown though the tree is still green.

In India, the planting period of the cardamom plantation is from august to march and is harvested in around the 3rd year of the time of plantation in the months of October and November.

Cardamom producing countries

The spice, Cardamom, is a native to the tropical areas of the world but some species of the spice can also be cultivated in the cooler areas of the world. The world�s total produce relating to cardamom is around 35000 metric tons annually. The major countries indulged in the production of cardamom are

Guatemala
India
Tanzania
Sri Lanka
El Salvador
Vietnam
Laos
Cambodia
Papua New Guinea
Sri Lanka
Thailand
Honduras
Nepal
Bhutan

Guatemala is the leading producer of this spice with a production of around 23000MT. Its share in the global production is around 66%. Earlier, India leaded the production list with the highest production figures but Guatemala overtook India�s lead, as there was a sharp rise in the domestic production of the country in the year 2003 and 2004. In the year 2002, Guatemala was producing just a mere 13500 MT. The area covered in the cultivation of cardamom has decreased since recent years but the productivity has increased significantly.

Production of cardamom in India

India has been a dominant player in the context of cardamom production. It was the leader in the spice production until Guatemala overtook India�s lead recently. Still, India is now the second largest producer of cardamom in the world. It produces around 11500 metric tons of cardamom every year. The cardamom cultivation is concentrated on the Western Ghats area in the country and it is also termed as Cardamom hills. The states in India that are indulged in the production of cardamom are

Kerala
Karnataka
Tamil Nadu

Kerala is the maximum contributor of cardamom to the country having a share of around 70% in the total production. Karnataka shares around 20% production and Tamil Nadu shares the rest. Kerala includes cardamom-growing districts like Udumbanchola taluka, Peeremedu taluka, Devikulam taluka. Shimoga constitutes the major district, which grows this spice in Karnataka. The Indian production got reduced in recent times and so is the area covered under the cardamom cultivation but the productivity that was around 46 Kg/Hectare in 1970s increased up to 210 Kg/hectare in 2003-04.

Indian cardamom market

India holds the credit of being the country that, for the very first time, discovered cardamom and made it famous in the world. The country has been a key player in each an every context related to cardamom whether it is production, consumption or deciding prices. The country�s earliest medical references found out the healing properties in cardamom and also found out its uses in medicines and other preparations. Cardamom has also been related to spirituality of the people in the country as this was the spice that was offered in the ceremonies and rituals held in the ancient India.

India has been producing this reputed spice since a long time and was the leading producer till 2002. It still is the second largest producer of cardamom after Guatemala and its production hovers around 11500 metric tons. Kerala is the largest producer of cardamom in the country producing around 8000 tons of the spice. The production has decreased as compared to the previous times when it touched around 12000 tons in 2002-03. The country has the maximum area covered in the cultivation of cardamom as compared to any country in the world. India stands at the 2nd place in the world consumption list also as it consume almost 90% of the domestic consumption. The maximum demand comes from the western part of the country at around 45% followed by the northern part constituting about 35%.

As India�s production is capable in satisfying the domestic consumption demand, it does not import any cardamom from outside countries. Rather, the left over cardamom gets exported every year that makes India a net exporter in the world market. The country exports 5 to 8% of its total production. India also exports by-products of cardamom like cardamom oil and oleoresins to the European countries. The major countries that import cardamom and its by products from India are

Saudi Arabia
Japan
Germany
Netherlands
United Kingdom

Saudi Arabia is the largest market for Indian cardamom. It gets a share of around 42% followed by Japan with 39% of the total India exports. Guatemala reduced India�s export market as it provides cardamom at cheaper rates and India producing cardamom of much better quality is not able to improve on its prices.

Market Influencing Factors

Major characteristics that indicates quality of the cardamom
Production status in competing countries like Guatemala
Annual production in the country
Weather conditions in the country
Domestic consumption demand
Seasonal variations and time of arrival of the crop in the market

Major trading centers of cardamom

The major trading centers in India in which cardamom is traded are

Vandanmedu (Kerala)
Bodinayakanur (Tamil Nadu)
Kumily (Kerala)
Thekkady (Kerala)
Cumbum (Andhra Pradesh)
Pattiveeranpatti (Tamil Nadu)
Cochin (Kerala)
Thodupuzha (Kerala)
Saklashpur (Karnataka)
Mercara (Karnataka)
Medikeri (Karnataka)
Mangalore (Karnataka)
Mumbai (Maharashtra)
Virudhunagar (Tamil Nadu)
Thevaram (Tamil Nadu)

Also, cardamom is traded in Indian commodity exchanges namely, National Multi Commodity Exchange of India and Multi Commodity Exchange of India ltd.