Red chilli prices under pressure due to high supply, weak demand

17-Apr-2025 03:58 PM

Guntur. Red chilli prices are facing downward pressure in major markets of Andhra Pradesh and Telangana due to a heavy supply influx and limited demand from local stockists, Disawari traders, and exporters. Following the end of Ramadan, demand from Gulf countries has also declined, reducing export activity.

In Guntur—the key chilli trading hub in Andhra Pradesh—daily arrivals are averaging between 1.25 to 1.30 lakh bags, while similar heavy inflows are being reported in Telangana.

However, demand has not kept pace with supply, forcing farmers to sell at reduced prices. Although prices remain largely stable with limited fluctuations, market sources say a significant price rise appears unlikely in the short term.

Interestingly, the area under chilli cultivation declined slightly in the 2024-25 season compared to the previous year, but favorable weather has boosted the yield, keeping overall production steady.

Despite lower prices, farmers are offloading stock rapidly out of concern that prices may drop further.

Notably, the state government had earlier announced a fixed-price procurement plan, but at that time, strong market conditions led farmers to request a delay in the intervention—an opportunity they now regret.