The Hindu Business Line : Under-invoicing alleged in cloves imports

Kochi, Aug 28 Under-invoicing is allegedly taking place in the imports of cloves into the country from certain origins, which in turn deprives the Government of duty revenue.

According to trading sources, prices of Zanzibar cloves were not printed in the Public Ledger Commodities online daily commodities prices and taking this opportunity, they alleged, the commodity has been cleared at $3,500 a tonne when the actual price of Zanzibar cloves is at $4,300 a tonne.

Prices quoted by the Public Ledger c&f Singapore for Indonesian cloves on Thursday (UK) were: $5,900 (high) and $4,550 (low); Madagascar $4,100/$3,150; Sri Lanka (f.o.b.) $5,400/$4,950 a tonne. The Delhi-based traders said that the cloves arrived from Sri Lanka were of poor quality as the season had ended there and the next crop is expected only in January. Exporters there were quoting $5,000 a tonne for the inferior quality material, the traders pointed out adding quality material is offered at $5,200 a tonne.

Meanwhile, Bangalore-based traders told Business Line that prices of best variety cloves imported from Madagascar, Zanzibar, Indonesia were available at Rs 260–Rs 290 and “best red cargo is being sold at Rs 310 a kg”, they said. The crop this year in Zanzibar, Comoros, Madagascar is said to be very small and the next Madagascar crop is estimated to be only 3,000 tonnes compared to 12,000 tonnes two years ago. Zanzibar crop was 2,500 tonnes and it has already been sold to Singapore and Indonesian buyers, they claimed. As the Indonesian crop is very small, the prices there have shot up to $6,300 a tonne. Lower crop in other growing countries have also pushed up the prices there to $4,300-$4,700 a tonne.

In India, stocks are very less when there is a good demand now. Therefore, the prices are likely to move up at Rs 5 a kg daily taking it to Rs 325 to Rs350 in next 15 days, they claimed. The Indian crop which is projected to be good this year would arrive at the markets only by early next year. The landed cost of Sri Lankan cloves would come to Rs 280 a kg.

According to some of the importers, “Colombo cloves’ crop quality is very bad for the past two years, as there are no proper standards, no checks, probably because of the low import duty at 4 per cent”. They alleged that Colombo farmers and traders take advantage of this and ship very bad cargo, spoiling the “Colombo cloves name”. This material is sold at Rs 280 a kg at a time when Madagascar cloves are selling at Rs 300-Rs 310, they said.

Colombo material, they alleged, “is the third grade cloves, which contain 10 per cent stems, 10 per cent poker cloves, wet cargo, black colour, and so, this bad cargo imports are killing our other cloves markets” they claimed.

They urged the Spices Board to look into this aspect and take it up with the Union Commerce Ministry for initiating some remedial measures. The Spices Board sources said that it had not come across any such issues.

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