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Tuesday, Apr 02, 2002

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Pepper prices up on short supply

Our Bureau

KOCHI, April 1

PEPPER prices have shown an upward trend during the last week on short supply and good demand at the terminal market here.

Spot prices increased by Rs 400 a quintal during the weekend to Rs 7,100 and Rs 6,700 for MG 1 garbled and ungarbled respectively from Rs 6,700 and Rs 6,300 per quintal compared to the previous weekend. The future deliveries also rose by Rs 550 to Rs 700 a quintal.

April contracts were at Rs 7,150 per quintal on March 30 as against Rs 6,600 on March 23. May Rs 7,115 (Rs 6,525), June Rs 7,160 (Rs 6,600), July Rs 7,170 (Rs 6,600), August Rs 7,275 (Rs 6,600) and September Rs 7,100 (Rs 6,600).

There were moderate buying activities last week on good domestic demand, while exporters were also active to fulfil their commitments.

The report on the possible drop in the Vietnamese pepper production had also had its impact, Mr Kishor Shamji, President, India Pepper and Spice Trade Association (IPSTA), said. Many in the domestic market were buying and building stocks as the price was low now, he said.

``In fact the domestic market is holding the price and its demand has driven the market up,'' he pointed out.

The present price trend had burnt the exporters' fingers, he said.

To cover the contract commitments many had to buy at higher prices now after committing at a low price, he added.

Meanwhile, according to international market players in Singapore, pepper supply position had become so unpredictable that the decision taking for both buyers and sellers had become more difficult than ever. ``Malabar is the only alternative for another eight weeks and should prices escalate, Sarawak and Lampung will not hesitate to adjust their prices accordingly,'' they said.

Indian stockists, they said, felt more encouraged to hold and as a result the exchange will be more active.

``Over supply will be there. However, it will not necessarily mean that prices will go back to pre-January levels as the supply chain has become bumpier'', they added.

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