Indian spices exports reached a record $4.46 billion in 2023-24, driven by strong demand for varieties like pepper and turmeric. Despite a 9% increase in shipment volumes, challenges such as quality concerns and crop shortages loom in the current financial year.
Highlights
Record High Indian Spices Exports in 2023-24: During the 2023-24 fiscal year, Indian spices exports achieved a record high, reaching $4.46 billion in value terms, a 17% increase from the previous year’s $3.95 billion. In volume terms, exports rose by 9% to over 15.39 lakh tonnes from 14.04 lakh tonnes the previous year. This significant growth was driven by increased global demand for specific spices like pepper, cardamom, and turmeric.
Volume and Value Increase: Indian spices saw a substantial rise in both volume and value in the 2023-24 period. In rupee value terms, exports grew by 16% to ₹36,958 crore, up from ₹31,761 crore the previous year. Key spices contributing to this growth included chilli, coriander, ginger, celery, fennel, and garlic. These spices experienced heightened demand, leading to increased shipment volumes and values.
Key Export Destinations: China, followed by the USA, Bangladesh, the United Arab Emirates, and Thailand, emerged as the top five destinations for Indian spices during the 2023-24 fiscal year. This underscores India’s position as the world’s largest producer and exporter of spices. These countries contributed significantly to the robust export figures, showcasing the global appeal and demand for Indian spices.
Challenges in the Current Financial Year: Despite the previous year’s success, Indian spices exports are anticipated to face challenges in the current financial year. Availability issues for certain varieties, such as turmeric, due to a lower crop yield last year, pose a significant challenge. Additionally, quality issues raised by countries like Hong Kong and Singapore over the presence of ethylene oxide (ETO) in some brands have also emerged as potential obstacles.
Early Indicators of Export Trends: According to quick estimates released by the Commerce Ministry for the first two months of the current financial year, spices exports in value terms were down by 5.84%, at $766.79 million compared to $814.37 million in the same period last year. This early dip indicates potential headwinds that may affect the overall performance of spices exports in the current fiscal year.
Insights from the All India Spices Exporters Forum: Emmanuel Nambusseril, Vice Chairman of the All India Spices Exporters Forum, noted that the impact of the ETO contamination issue on spice exports is minimal. The primary decline observed is in the export of spice blends (masalas). While some spices like turmeric have seen a drop in exports due to crop shortages, value-added products remain largely unaffected by these issues.
Expectations for the Current Fiscal Year: Despite the challenges, the overall outlook for spices exports in the current fiscal year remains stable, with expectations to match the previous year’s levels. However, increased demand for new test results by external laboratories due to the ETO issue is expected to impose additional financial burdens on exporting companies, potentially affecting their operational costs and export strategies.
Conclusion
The remarkable performance of Indian spices exports in 2023-24 underscores India’s dominant position in the global spices market. However, the current financial year poses significant challenges, including quality concerns and crop shortages, which may impact export volumes and values. While the industry anticipates stable export levels, the financial burden of additional testing requirements due to the ethylene oxide issue highlights the need for strategic adjustments. Maintaining high standards and addressing availability issues will be crucial for sustaining growth and meeting global demand.
