Tips and Techniques of Trading Chillies in Commodity Market

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The Botanical name of chilli is Copsicum Annum. It comes from the family of Solanaceae. Red Chillies were cultivated in Latin America in the olden days and was later started in different regions from all around the world. Now days chillies are the used by people of all regions and cultures and is also used in many different fields. The major part of chillies is used in food preparation as they are known to give a special flavor to any dish. Chillies are known to produce natural warmth and also help in circulation of blood. It is also used in the treatment of cholera. It is also used in prevention of blood clots and is also known to show amazing affects in treatment of depression.

Chilli Trading:

Chillies are traded in two major exchanges in India NCDEX being one of the exchanges. The ticker symbol of chilli in this exchange is CHLL334GTR. The quality which is majorly traded is the LCA 334 variety. The color of this red chilli is bright red in color and the size is not less than 5cms. The other majorly traded variety is the Sannam produced from Guntur from Andhra Pradesh.

The trading takes place from 10.00 am to 5.00 pm during the weekdays and from 10.00am to 2.00pm on Saturday. The delivery is on the 20th of every month and if it happens to be a holiday or a Sunday or Saturday then the delivery shall be the day the next trading session begins.
There are many factors which influence the prices of chilli. The major factors are the supply and the demand. If there is high production of chilli but if the demand is less then the prices might remain the same or might even come down. But if the production is less with high demand then the prices increase a lot. The deficiency in production also happens due to some unseasonal rains or any other natural calamities.

As per the recent news in the market about chillies, there is an increase in selling. Now that there will be arrivals in the market, it is estimated that the prices might relax a little. So it is good to sell of any open positions if any. The export demand is also quite less now due to much cheaper competition from China.

Now that even the exports are less, it is likely that the prices might reduce. Chinese chilli is very low priced in today’s market and it is also known that they have had a real good yield. Hence, with low exports and even the farmers trying to sell of the crop at the market prices might bring down the price of the chilli.

It is always a wise decision to read the news before trading any commodity. Positive news about any commodity can increase the price at times irrespective of any other factors and the same is also applied to the decrease in prices. So if you already have a position on hand which is in profit, it would be a wise decision to exit on profit.