7Th March 2019 INTRODUCTION

Source: Photo clicked in between Patan and Deesa Belt 7th March 2019 INTRODUCTION Choice Research had conducted Unjha Mandi visit on 28thFebruary-1st March 2019. The objective of the visit was to interact with spot traders, farmers, exporters, physical brokers, millers and agro- industrialists, and to gain an insight on the new Jeera crop scenario. During the survey, we have also gained information regarding the quality of the new crop, daily market arrivals, expected total production (in bags) for the current year and carry forward stocks from the last year. In addition, we have also gained in-depth knowledge on the demand scenario in the domestic and the international markets. Furthermore, we have studied the entire value chain i.e. from the raw Jeera coming to the Unjha Mandi from the farmers and firms till reaching the factory and getting processed. We have also studied various other factors such as profit margins of the firms/millers, commission charged by them to the traders. Correspondingly, we have surveyed regarding the price outlook of various physical participants. Moreover, we have visited some of the farm lands in the nearby regions of Mehsana, Patan and Banaskata regions of northern Gujarat. Lastly, along with the above survey, we have also included our In-house outlook on Jeera supported with the Balance sheet, Seasonality trend charts, Spread call for the next month futures and a quarterly technical outlook. Jeera Auction in Unjha APMC Jeera Auction in Unjha APMC Jeera APMC Unjha Jeera APMC Unjha VALUE CHAIN Raw Jeera are transported by the farmers to the firms in AMPC Unjha Mandi from their respective regions of Gujarat and Rajasthan. The goods are sold in Unjha Mandi auction by the firms with the help of AMPC members. Auction is conducted on all six days in the week considering that there is no public/ national holiday falling during the week. First auction starts at 9 am till 1 pm. Multiple auctions are conducted at the same time during the given time frame. Unjha market is also famous for Soaf and Isabgul seeds which are also auctioned during the day. Second auction resumes at 3:30 pm till late evening depending on the daily arrivals by the farmers in the market. Auction is basically an open outcry where various buyers/traders bid for the lots (1 lot= 20kgs) that they would want to purchase in the market. Buyers/traders generally check the quality of crop by holding fist full of Jeera, comparing it with other stocks available. Checking the moisture content, oil content and weight are also done during the process. Correspondingly, the traders decide the best price for the lot which also includes the amount of cleaning/removing of stones and other materials that is required for the same. There are generally 3 quality types of Jeera sold ranging in different prices in the market. Export Quality- Current Price for Auction Rs.130-140/kg. NCDEX Quality- Current Price for Auction Rs.140-150/kg Domestic Quality- Current Price for Auction Rs.150-160/kg Comparing the above 3 qualities, the domestic quality has the highest weight with good moisture content. Quality of NCDEX is average but with lower weight and oil content as compared to domestic quality. Export quality has the lowest weight and lower quality among the three and hence it is traded/bid at a lower price. Other Jeera qualities that forms a part of auctions are the European and American quality Jeera which are even higher than the domestic quality. Those are basically premium and organic quality of Jeera possessing higher oil content and medicinal value, which are usually less found in Unjha market during the day. Some of the above Jeera qualities come from the higher sowing and yield areas of Gujarat and Rajasthan state, while the rest others are found after cleaning, processing of Jeera in the factories. Based on recent traders survey, Jeera crop coming from Rajasthan have been relatively better in quality and oil content in the past few years. Furthermore, the size of Jeera crop have been higher compared to that of Jeera harvested in Gujarat. European Quality – Current Price for Auction Rs.160-165/kg American Quality – Current Price for Auction Rs.165-170/kg The earlier mentioned low export quality are usually exported to Egypt and Bangladesh. China and Japan mostly prefer domestic quality of Jeera while UAE prefers similar quality to the European. In the above left picture, auction of Soaf is being conducted in the same Unjha market while the top right picture is of Isabgul seeds which are kept for daily auctions by farmers/firms. By the end of the day, Jeera are loaded and send to the respective factories of traders. Mandi Firms charge a standard 1.5% margin on the farmer’s price at which they had brought earlier before auctioning in the Unjha APMC market. In addition, firm charges commission for loading, unloading, transportation of Jeera to the respective trader’s factories or warehouses. Factories are majorly located in the nearby areas of Unjha Mandi where the goods are processed in machine. Processing/ cleaning in the factory are mainly done for removing of dirt/mud, extra fertilizers, pebbles that are usually found in Jeera. Storage of raw material is done in one section of the warehouse and machine clean finished goods are stored in another section of the factory. Storage of finished goods is also done in vacuum weather-free section warehouse for longer life duration. The usual life of Jeera crop is 1.5 to 2 years depending on the kind of storage being made. If the storage is good, crop life can last for 3-4 years. The export quality and NCDEX quality processed Jeera are kept in gunny/jute bags while domestic quality Jeera is packed in plastic bags varying in different size/weight requirement in domestic market. The daily working of the machine is 12 hours in a day and during the peak demand season it runs almost for 24 hours. The cost of processing/machine clean of export quality Jeera is Rs.15/kg while domestic and NCDEX quality Jeera are Rs.18 and Rs.20/kg. The cost of processing /machine clean of European and American quality of Jeera is usually Rs.22 and Rs.25/kg respectively. Some of the traders have their own brand of packaging Jeera in various weights and quality wise. Jeera packaging are generally done in weights of 100 grams to 1 kg. In addition, based on the quality of Jeera, packing is also different for the same. Every trader has a different style and name for packaging based on the quality of Jeera. Below are few names of Jeera brands in top down format based on quality that are sold from Unjha market. 1. Super Bold 2. Bold 3. Super 4. Gold 5. NCDEX 6. Average Image 1 : Jeera which are brought post the auction are put in the machine for cleaning and processing. Image 2 : The process of cleaning of Jeera take place which includes removing of stones, pebbles, fertilizers and mud/dust. Four bags are kept below the machine with one removing the mud and dust particles, another one removing the pebbles/stones and fertilizers, third one having the unclean Jeera which still contains the above items in it, while the fourth one the fully processed machine clean Jeera which is ready for delivery or storage in gunny/ jute bags. The third bag having unclean Jeera is once again put inside the machine for another round of cleaning in the same process. Image 3: The image in the left is the full picture of the machine which is used for cleaning and processing of Jeera. Image 4 : The image in the left is of the warehouse near the factory machine which is used for storage of raw material and machine clean processed Jeera. Moreover, most traders have connected storage warehouse for extra storage capacity during the peak harvest/supply season. Traders mostly store machine clean processed Jeera in the attached warehouse as it vacuum weather free section. Image 5 : In the next image, we can clearly see that Jeera is stored in gunny/jute bags which is also moisture free and weather resistant. Furthermore, Jeera is sold in gunny bags in the NCDEX market during the time of delivery. The quality and moisture content specifications of Jeera are different for NCDEX as compared to domestic quality. Some exporters and domestic buyers do buy Jeera in gunny bags which excludes packaging costs. Image 6 : Based on the bottom left image, generally domestic quality Jeera are stored in plastic packaging bags to be supplied for the wholesalers in various APMCs across India. Below two images are of packing machine and the various packaging brands of Jeera on quality basis. Jeera Trader & Exporter in Unjha APMC Jeera Trader & Exporter in Unjha APMC KEY FINDINGS 1. Opening Stocks: We are witnessing opening stocks of 3-4 lakh bags (1 bag=55 kgs) for the year 2018-19. It is higher compared to last year 2017-18 opening stocks of 1-2 lakh bags. Earlier during the Jeera crop sowing season (Oct-Nov), opening stocks for the current year(2018-19) had been around 8-10 lakh bags, but then supply of old crop had continued in the major market Unjha which has reduced the current opening stocks to 3-4 lakh bags by the current harvest season. Higher production in 2017-18 as compared to the domestic and export demand has led to the incline in carry forward stocks for 2017-18.

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