China’s demand for Indian Red chillies pushes up spice exports

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Photo by Shubha Gambhir on Unsplash

Hot and spicy red chillies continue to top the export basket of spices from India. And China emerges as the largest importer of Indian red chillies, especially the fiery Teja variety, as it consumes large quantities of the pungent spice.

In FY21, India exported 6,01,500 tonnes of red chillies worth about Rs 8,430 crore. The spice now accounts for 38 per cent of the volume and 31 per cent of the value of all spices exported from India.

Chilli shipments crossed the $3.5 billion mark in total exports during 2020-21 fiscal. In 2019-20, the figure was $3.03 billion. This has further cemented red chilli’s position as the largest exported single spice from the country.

The total spice exports from India fetched over Rs 27,193 crore last year.

Though China has a large cultivation of low-heat paprika chilli, however the demand for high-heat Indian chillies has been increasing especially for Indian varieties such as Teja, Sannam, Bydagi.

The proper blending of these varieties makes it possible to prepare the right compositions for various markets. Besides Indian chilli exporters can export to China with ease.

Further, the reduction of chilli procurement by China from the strife-torn Syria, Turkey and Iran has also boosted the demand for Indian chilies.

According to Industry watchers the other factor that has influenced exports last year was that many exporters could not process chilli because of lockdowns and other COVID-19 restrictions. However, with China putting up factories for processing the demand for raw chilies from India shot up.

As a result of high purchase of red chillies in 2020, the demand is expected to rise in the current financial year as well. The average price of the Teja variety hovers in the range of Rs 145 to 150 per kg, which is almost the same from a year ago. As exports picked up, the prices rose to Rs 180-190 per kg last year.

India is the world’s largest producer, consumer and exporter of chilli. Red chillies are grown across India on 792,000 hectares of land in Andhra Pradesh, Karnataka, Madhya Pradesh and Maharashtra. The crop is planted in August and September, and harvested in March and April.

Of the 1,376,000 million tons of red chilli produced in India every year, 70 per cent are consumed domestically, while 30 per cent is exported. Dried chilli exports make up 22 per cent of all the spices exported from India.

Shampa Bahadur has been a business journalist for more than two decades. She has written for Business India, PTI Media TransAsia and India Infrastructure Publication Ltd among others. She has also written coffee table books. She can be reached at shampa@indoasiancommodities.in

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