Ancient spice trade takes e-route

In 80 BC, when the Egyptian city of Alexandria became the busiest commercial center on Earth, its bazaars were stocked with Indian spices en route to markets in Greece and the Roman Empire. Later Columbus and Vasco da Gama set sail for India through different routes. The ancient traders will probably be baffled by the parks and electronic gadgets that are being used for trading in spices. However, the new method is more transparent and beneficial to the farmer.

by RAJA M

If the ghosts of Christopher Columbus and Vasco da Gama continue craving for new sea routes to India’s fabulous spices, they won’t need a ship to ride across the unknown: they can spiritedly log on to e-auctions launched last month by India’s Commerce Ministry, as part of efforts to regain the country’s global primacy in cardamom.

The electronic auction is expected to help farmers and small traders by increasing transparency in transactions in the cardamom trade and snuff out cartels and auction riggers. Cardamom, called the “queen of spices”, is the world’s third-most-expensive spice after vanilla and saffron, averaging US$10 per kilogram at auction rates.

As in earlier millennia, India is the world’s largest spice producer, accounting for 44% of global output and 36% of global trade. “India is the world’s biggest producer, consumer and exporter of spices,” says V J Kurien, chairman of the apex Spices Board of India.

Based in the southern city of Cochin and functioning under the Ministry of Commerce, the Spices Board of India website announces that it achieved an “all-time high” in spice-export revenue for 2005-06, but since then India’s spice trade is facing challenges with production problems at home and new competitors abroad. Any makeover is welcome.

According to Spices Board data, India’s exports in April-July climbed 29% in volume to 152,650 tonnes, thanks largely to better demand for fenugreek and chili. “Exports are expected to clock 380,000 tonnes in 2007-08, worth $875 million, and reach $1 billion by 2008-09,” said Kurien.

India is also setting up five exclusive “spice parks” to facilitate export quality control, with four in the south and a spice park for mint in Lucknow, the capital of the northern state of Uttar Pradesh. The spice parks will offer land within the complex to private entrepreneurs to establish processing units, from which spices will be directly exported. “By 2017, we would like India to be the only processing hub for spice in the world,” said Kurien.

Both the e-auctions and spice parks are appearing for first time in the world’s spice trade. Each of India’s 40,000 cardamom farmers registered with the Spices Board will also get an identity card before December 31, promised the Commerce Ministry.

India’s new spice drive echoes earliest recorded history, when cardamom, black pepper, chili, clove and coriander were among India’s most wanted exports. In 80 BC, when the Egyptian city of Alexandria became the busiest commercial center on Earth, its bazaars were stocked with Indian spices en route to markets in Greece and the Roman Empire. The Archeology Department of India has reported finding 100,000 Roman coins in the Cauvery River delta, southern India, along the old spice trade route.

In the 15th century, Columbus and Portuguese seaman Vasco da Gama set sail in opposite directions to chart a new sea route to India for its spices and silk. While the American continent got in the way of Columbus, who thought he had reached India, da Gama landed on India’s western Malabar Coast in May 1498, and set about colonizing Goa, the Indian state that Portugal would hold for 450 years until 1961 when the Indian Army moved in. Goa will host the ninth World Spice Congress next January, an event annually organized by the Spices Board and the All India Spices Exporters Forum.

India was the world’s largest cardamom producer at the turn of this century, but suffered production losses due to untimely weather conditions in key growing areas. Prices and India’s export share of cardamom dipped too, with Guatemala recently accelerating its cultivation. Spices Board chairman Kurien pointed to another aspect: “Our [domestic] consumption of cardamom is so great that only 6% of our production is exported.”

Saudi Arabia (which popularly uses cardamom in gahwa - Arabian coffee) and Japan are the biggest buyers of Indian cardamom, consuming 511 and 225 tonnes respectively during 2005-06. Malaysia ranks a distant third with 34 tonnes.

Cardamom, indigenous to southern India and Sri Lanka, is a traditional multipurpose spice used as everything from medicine to mouth freshener, but primarily to flavor a wide range of Indian cuisine, from pulav to kheer - the delicious rice pudding made with milk and dried fruits.

Cardamom also features in traditional grandma remedies of the kind the Spices Board website suggests as a cure for a sore throat: “Powder cardamom seeds. Take a bit of cinnamon. Boil both spices in water. Add salt when water comes to the boil. Filter this well, and use for gargling. Brings instant relief to sore throats and prevents further infection.” Cardamom is also expected to bring relief to farmers through e-auctions. The Tamil Nadu-based Cardamom Planters Association declared that better prices and honest competition are assured with the identity of bidders being kept secret. The e-auctions are also expected to reduce administrative costs and documentation mistakes.

The weekly cardamom e-auction system, developed with Indian software giant Tata Consultancy Services, was launched in Bodinayakanur, Tamil Nadu, the primary center for cardamom trade in India. Other major spice-auction centers will go the same e-way, say Spices Board officials, after Gauging how Bodinayakanur fares online. India’s old spice trade is wearing a new look.