KOCHI: Four years ago, when planter Zachariah Njavellil sold a portion of his cardamom plantation in Idukki, he got around Rs 30 lakh an acre. Today, plantations adjoining the same property are quoting nearly Rs 80 lakh an acre -- with prime properties touching Rs 1 crore an acre.
The surge in cardamom prices has triggered a fresh rush for plantations in Idukki, with buyers from neighbouring Tamil Nadu emerging as a major force in the market.
“Four years ago, I sold part of my cardamom plantation holdings at Rs 30 lakh an acre. Now, the going rate for plantations adjacent to that plot is around Rs 80 lakh,” said Zachariah, a planter and member of the Cardamom Planters Federation.
Cardamom, popularly known as the ‘king of spices’, has been a lucrative crop for farmers in Idukki over the past three to four years, with prices generally ranging between Rs 2,500 and Rs 2,800 a kg and bulk prices touching Rs 3,000. The sustained price rally is now spilling over into the land market. As the returns from cardamom improve, plantations are once again becoming attractive investment propositions, pushing up demand and prices.
“For any crop, when prices rise, there will be demand for plantations. There will be a rush. We have seen this phenomenon in the past too,” Zachariah said.
The buying interest is particularly strong from planters and investors in Tamil Nadu, especially from the Cumbum, Bodinayakanur and Theni regions. The geographical and historical links between the two regions are also helping drive the trend.
“Tamilians have good connections with Kerala. If you look back, their forefathers had been in Idukki even before Malayalis entered the field. We bought plantations from Tamilians in the early 1960s,” Zachariah said.
For buyers from Theni district, the Idukki cardamom belt is also easily accessible through Cumbum, Bodinayakanur and Pannepuram.
Many buyers are themselves cardamom planters or traders with established links to the spice market.
Another planter said transactions of up to Rs 1 crore an acre were taking place, though these were mostly for smaller holdings of one to three acres, with transactions rarely extending beyond five acres at that rate.
“Most transactions are happening in the Rs 60 lakh to Rs 80 lakh range. When the extent of land for sale increases, the per-acre value generally comes down,” he said.
The Rs 1-crore deals, he added, are for properties with good road access, water availability, healthy plantations, and other facilities.
“Many factors come into play when someone pays Rs 1 crore an acre. The condition of the plantation itself is important,” he said.
Property consultant Gigi Cherian said the jump in prices was particularly visible in the Nedumkandam belt over the past 18 months.
A 50-cent commercial cardamom plot in Nedumkandam is being quoted at Rs 60 lakh, translating to Rs 1.2 crore an acre. A 1.5-acre property with a house and around 600 cardamom plants is being quoted at Rs 1.2 crore, while five-acre plantations in Kattappana are available around Rs 49 lakh an acre. In prime locations, prices can go even higher.
“Rs 1 crore an acre is real for prime, road-touch, ready-yielding plantations,” Cherian said.
The limited availability of land is another factor. Cardamom cultivation is concentrated in Idukki’s Udumbanchola, Peermade and Devikulam taluks, leaving little scope for a major expansion of the traditional plantation belt.
Meanwhile, the prospects for cardamom prices remain encouraging. Production in Guatemala, the world’s largest producer, has not seen a significant revival, supporting expectations that prices could remain firm in the short to medium term.
For planters, the numbers make the land premium easier to digest. At current prices, a well-maintained acre can generate a healthy annual return.
“If cardamom prices sustain, the investment may not be a loss. From one acre, a planter can get a profit of around Rs 10 lakh a year. That means roughly a 10% return on investment. It is not a bad deal at all,” Zachariah reckons.
For now, the cardamom boom is doing more than filling farmers’ pockets. It is putting a fresh price tag on Idukki’s plantations.
Worth its weight in spices
As the returns from cardamom improve, plantations are once again becoming attractive investment propositions
The buying interest is particularly strong from planters and investors especially from the Cumbum, Bodinayakanur and Theni regions