Tight Supply Likely in Red Chilli Due to Lower Production

27-Feb-2026 03:10 PM

Guntur: A mixed trend is currently being observed in the Indian spice market. Red chilli production is expected to decline sharply by 35–40 percent, which may lead to a tight supply situation. On the other hand, improved prices last year are expected to encourage higher turmeric production this season. Meanwhile, the export market for dry ginger (sonth) remains uncertain and volatile as China continues to strengthen its hold on the global export market.

India is the largest producer and exporter of red chilli in the world, with an average annual production of around 2 million tonnes. However, during the 2025–26 season, production is expected to decline by 35–40 percent. This is mainly due to a reduction in acreage in major producing states such as Andhra Pradesh, Telangana, and Karnataka, along with unfavorable weather conditions.

Sowing during October–November remained below normal, and in some areas the early-sown crop suffered damage. Harvesting has now begun, but market arrivals are lower than expected, leading to a tight situation in spot markets.

Although carryover stocks are estimated to be 8–10 percent higher than last year, trade analysts believe that actual availability may decline by 25–30 percent.

Last year, higher stocks initially kept prices weak, but later red chilli prices remained firm until January 2026. Export demand has continued to remain strong, with China emerging as a major buyer.