Dhaniya (Coriander): A Tale of Fluctuating Demand By Amit Gupta, Kedia Advisory
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Dhaniya (Coriander): A Tale of Fluctuating Demand
Dhaniya, also known as coriander, is a versatile spice used in various culinary dishes globally. In recent times, Dhaniya prices have exhibited an upward trajectory, rising by around 5% in a week as the festival season kicks off, and domestic demand is expected to pick up. The export scenario for Dhaniya during April to June 2023 shows a remarkable increase of 335.58% compared to the same period in 2022. The weakening of the Indian Rupee has made competitive export prices, contributing to higher export demand.
Interestingly, Iran's coriander production has experienced a staggering 70% drop compared to the previous year. This has created an upward pressure on Dhaniya prices, especially considering that the current year has seen the prices of several spices, such as chili, cumin, ginger, and turmeric, rallying. Russian coriander has also garnered attention due to its competitive pricing. However, the FMCG demand for Dhaniya is not currently at its peak, and traders are awaiting sowing figures to better assess the market dynamics.
The upcoming sowing season for Dhaniya is expected to witness a drop in acreage, as farmers may shift to other crops. Persistent delays in Russian coriander shipments have created uncertainty. Out of the 150 containers scheduled for August shipment to India, only 40 have been dispatched, signalling a resurgence in demand. Furthermore, El-Nino is expected to impact yields in Rabi crops, also affecting Dhaniya yield. September is the time when most international stockists take positions until the next seasonal arrival. Competition from alternative sources of Dhaniya imports, such as Russian imports, could once again lower prices amidst concerns of oversupply.
On a technical note, a "Death Crossover" has been observed on the weekly chart of NCDEX Dhaniya, indicating a potential shift in market sentiment. New coriander crops are anticipated to enter the market from countries like Syria and Russia in the coming months. A temporary pullback in prices could be expected in the short-term for Dhaniya, with strong support at around Rs. 6,600 - 6,700. However, the long-term sentiments are supportive enough to drive prices to Rs. 8,400 in the coming 3-4 months
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