FCBL explores markets for cardamom export

The products are currently stored in a warehouse in Phuentsholing

The Food Corporation of Bhutan Limited (FCBL) is currently exploring markets for export after having bought 50MT (Metric Tons) of cardamom through a buyback scheme from farmers of eight dzongkhags this year.

The highest quantity of cardamom was bought from Dagana Dzongkhag with 20.66MT, followed by Zhemgang Dzongkhag with 7.49MT. FCBL collected 1.95MT and 1.66MT from Chhukha and Samtse respectively.  FCBL paid Nu 390 to Nu 470 per kilogram based on the quality of the cardamom.

The main concern from farmers that emerged during the buyback scheme was on the price offered to them. However, the Chief Executive Officer of FCBL, Naiten Wangchuk, said the rate was fixed by the committee in the agriculture ministry before starting the scheme. The committee had categorized the cardamom into five different classes with price ranging from Nu 390 to Nu 470.

Since the farmers fetched better prices earlier, the CEO added that they had expected the same when they heard the agency would buy back their product.

“But the market scenario is different now and the price has declined. The committee has surveyed the market price and the rate was above the prevailing market rate of those days,” he said, adding that there was no compulsion on the farmers.

Meanwhile, four teams from FCBL toured the selected dzongkhags at their allocated collection centers to buy cardamom from farmers. This had eased the farmers from having to spend days to reach the market and expenses during their stays in the towns. The scheme also facilitated immediate payments to the farmers.

However, FCBL is uncertain whether to continue the practice in the future, but it hopes to continue if the farmers face similar crisis in the future.

“Still, FCBL will accept the product if the farmers wish to sell,” the CEO added. 

Meanwhile, FCBL had carried out the initiative, ‘Buyback Scheme’ to boost the morale of the farmers in the wake of cardamom price crisis in the market. With Nu 50mn allocated by the government, FCBL has used Nu 20.74mn to procure cardamom as of now.

 The products are currently stored in a warehouse in Phuentsholing, which will be processed for export. The corporation is currently exploring reliable market for the crop. Currently, they have corresponded with the traders in India for export. FCBL plans to explore markets in the middle-east and American countries where the demand would be higher. There is demand from Pakistan too.

However, FCBL plans to maintain quality prior to exporting the cardamom for better price and brand. They have sent two samples for test in the laboratory in Mumbai, India.

Naiten Wangchuk said maintaining the quality would be prioritized before starting formal trade.

“We are looking for reliable markets for a good price. But we are also cautious about the quality before we export,” he said, adding that it would take a month to finalize the destinations.

Meanwhile, with the current price offered to the farmers, some are reluctant to sell their hard-worked crop.

Most farmers in Bhutan started cardamom cultivation along the southern foothills when the price soared in the market a decade ago. They focused on the crop and it became a prime source of income for them. However, the plummeting price has now compelled them to return to growing other crops. The price had once skyrocketed to Nu 1,800 per kg, which has now drastically fallen to Nu 450 for the supreme quality.

It is believed that the market price of cardamom in Phuentsholing increased when the FCBL ventured into the business. However, the FCBL’s CEO said the increase has in fact helped the farmers.

“But we are looking into reliable markets for long term with the scope to export as industrial raw materials. We are exploring about it and will help the farmers,” he said.   Meanwhile, FCBL had also procured around 16MT of cardamom after paying Nu 10mn earlier before the buyback scheme. The product is already graded and ready for export.

Krishna Ghalley from Phuentsholing