A to Z of Cardamom Auction

Cardamom Auction

Cardamom can be broadly classified into Large Cardamom(Black) and Small cardamom(green cardamom).

Large cardamom is found mostly in the North Eastern States of India. Sikkim produces about 90% of large cardamom.

The auction for green cardamom takes place in Puttady (Kerala) and Bodinayakanur ( Tamil Nadu).The auctions are held from Monday to Saturday. In Bodinayakanur the auctions are held on Monday, Wednesday and Friday. And on other days its held in Puttady(Kerala). The Spices Board of India holds these auctions in Spices Park .

E-auctions or electronic auctions are used by the Spices Board to provide better prices for the cardamom growing farmers.

What is e-auction and who can take part in e-auction for cardamom purchase?

To take part in cardamom auction, one need to avail the cardamom dealership license from the Spices Board of India. Current account from a bank, a storage space for cardamom storage(easily accessible for heavy vehicles), GST license, confidential letter from bank, and a fee of Rs 5000 payable to Spices Board of India are some of the requirements to avail a dealership license.

Once the the cardamom dealership license is procured, the dealer has to convince the auctioneer to take part in the auction. The dealer has to provide the License and GST papers to each auctioneer.Sometimes a small amount has to be given in advance for the new dealer to the auctioneer.

Who is an Auctioneer?

Auctioneers are large companies(12 at present) which conducts the auction supervised by the Spices Board. The auctioneer purchases cardamom from farmers and dealers(Payment is not given at the time of purchase) and provides a LOT Number to the farmer or dealer. The specified LOT number is the sample procured from that particular farmer or the dealer. A sample of 1.5Kg is taken from the particular lot and is moved to the Spices Park on the day allotted to that auctioneer for conducting auction. The rest of the cardamom will be stored in the auctioneers warehouse in sacks.

On the Day of Cardamom e-Auction

Cardamom auction is held in two sessions. The first session is the forenoon session. The second session is the afternoon session. Thus two auctioneer companies take part in the auction in a single day, one for the forenoon session and the other in the afternoon session.

The dealer can take part in any session according to his preferences for a particular auctioneer. He can even take part in all sessions from Monday to Saturday.

The dealer will be given a computer terminal to mark his entry on the day of auction.A small dish is provided to the dealer in which samples of a particular LOT( A part of 1.5Kg earlier procured from the farmer) is thrown by the auctioneers men who keeps on running to and fro to provide samples to each and every dealer.A benchmark price is shown in the computer for the corresponding sample and if the dealer feels that its value is more than the benchmark price he can press the ENTER Key of his computer thereby increasing the price by Rs 2.00. Maximum enter value is Rs 9.00 at a time.The dealer who bids the maximum prices wins the bid for the corresponding LOT and a sample of 100gram is given to the dealer (to ensure the lot is same as the one he won). Seven seconds(7 Sec) is the time gap for an entry in the computer.i.e if a dealer presses the ENTER Key and no one presses the ENTER key by 7 seconds, the corresponding dealer wins the bid.

The auction ends when all the LOTS kept for auction are completed. The computer shows details of every lot in terms of its weight, price it secured etc. Tea, snacks and Lunch are provided free of cost by the auctioneer company.

When to make the payment by the Dealer onCE he wins the bid?

The payment should be made within 15 days to the auctioneer company by the dealer for his purchase.The auctioneer company charges an interest rate for late payment. The farmers can claim the price they won in the auction and most companies provide the fund to the farmers within a week.

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