As cardamom prices hit a record low, local traders in Phuentsholing, who buy cardamom from villagers and sell it to a larger group of exporters, has called for strict intervention from relevant authorities to stop entry of cardamom from across the border.
Local traders claim that cardamoms from Nepal and Assam are entering into the country. They claim that the cardamom from these places is graded in Siliguri and the small-sized cardamom, which is low in quality, enters Phuentsholing.
“All low-grade quality cardamons are directed to Phuentsholing, made as if it is Bhutanese cardamom and exported to Bangladesh,” a dealer said. “Our cardamom loses the market as exporters do not buy from us.”
The cardamom traders also said there are a handful of exporters practicing such trade and they don’t buy the cardamom from local farmers. “They are exporting in huge quantity,” a local supplier said.
Talking to Kuensel, the suppliers said they buy from farmers but are unable to directly export to Bangladesh, as it requires huge investments. So those who can invest are meddling the market.
A cardamom dealer from Samtse said this practice has been going on for about a year. The Jitti border in Samtse is the place where cardamom from Siliguri enters Bhutan.
“Once the spices are in Bhutan, it is then brought to Phuentsholing,” he said. “Although I cannot provide any proof, this has continued for the last one year.”
The dealer also said that loads of higher quality cardamoms from Sipsu are exchanged with those from Assam and Nepal across the border in Jitti. “As quality cardamom goes to Indian market, the low quality cardamom enters Phuentsholing.”
In 2017, when both supply from the orchards and prices had deteriorated, Bhutan exported 669MT of cardamom worth USD 7.35M in 2017. It is the highest in the last eight years. In 2016, Bhutan exported 300MT worth USD 4.5M.
The existing price of cardamom in Phuentsholing is Nu 550, the highest, and Nu 500 a kg, which is the lowest depending on the size and quality. In February this year, farmers fetched Nu 700 to Nu 750 a kg.
The floor price has been declared at USD 9,000 per metric tonne (MT) starting August 1. Prior to this, it was USD 11,500 a MT.
Meanwhile, exporters are still unable to transport cardamom from Phuentsholing into the Indian market. After the introduction of the Goods and Services Tax (GST) in India last year, the land customs station across the border in Jaigaon had asked exporters to get certification from Kolkata for the cardamom consignments. The certification from Bhutan Agriculture and Food Regulatory is not accepted.
A cardamom exporter, who is the proprietor of Bhutan Export Business Line (BEBL), Shivalal Subedi, said although there is no problem with Bangladesh export, India market remains a problem.
“We cannot directly transport our produce from Phuentsholing via Jaigaon customs office,” he said, adding that nothing was done despite raising the issue several times.
“We are transporting all the way to Samtse and taking it into the Indian market,” he said. “If this problem were solved, it would help both exporters and farmers.”
Rajesh Rai | Phuentsholing