Producers worried over falling prices of red chilli due to weak export demand

17-Dec-2024 04:01 PM

Red chilli producers in Andhra Pradesh are currently facing significant challenges due to weak market prices, which have been falling in recent weeks, especially in Guntur, the largest trading center for red chilli in Asia.

Despite the usual trend of higher prices in the final months of the year, the prices have been pressured by increased production, high stock levels, and weak global demand.

Farmers from regions like Kurnool, Nandyal, Dache Palli, Sattenapalli, and Telangana, expecting better returns, have been flooding the Guntur market with their produce.

However, the demand has not matched the increase in supply, leading to a drop in prices. On average, more than 1.5 lakh tikkis (a unit of measurement for red chilli) are traded in the Guntur market, which is exported to over 20 countries, contributing to an annual turnover of about ₹10,000 crore and generating ₹100 crore in revenue for the state government.

However, in recent times, major varieties of red chilli have seen price drops ranging from ₹1,000 to ₹2,000 per quintal.

As a result, producers are incurring significant losses. Prices in the Guntur market now range from ₹13,000 to ₹16,000 per quintal for Teja S 17, ₹11,000 to ₹14,500 for 334 Sannam, ₹9,000 to ₹12,000 for Byadagi, and ₹9,000 to ₹14,000 for other varieties.

Experts have pointed out that demand from key importing countries like China, Bangladesh, and Vietnam has weakened.

Bangladesh, in particular, is reported to have sufficient stock of red chillies for the coming month, further exacerbating the situation for producers.