The Hindu Business Line : Pepper prices gain on short supply

Spot was up by Rs 400 a quintal on Tuesday compared to last Saturday. MG 1 was sold at Rs 7,700 a quintal and un-garbled at Rs 7,400, compared to Rs 7,300 and Rs 7,000 respectively on March 13.

Futures also witnessed substantial increase. Prices were April Rs 8,120 against Rs 7,752 a quintal last Saturday, May Rs 8,325 (Rs 7,948), June Rs 8,504 (Rs 8,172), July Rs 8,740 (Rs 8,399), August Rs 8,852 (Rs 8,507) and September Rs 9,020 a quintal.

Arrivals at the terminal market have gone down to five tonnes a day. There is no selling pressure as the harvesting in Kerala is almost over.

Due to increase in domestic prices, Indian pepper has been outpriced in the international market at $1,700-1,750 a tonne.

Vietnam is offering 500 GL at $1,300, 550 GL at $1,375 and Asta at $1,450-1,475.

Indonesia and Brazil are also offering at $1,450-1,475 a tonne.

As the international players are covering at current levels to fulfill their commitments, the prices in Vietnam have also moved up.

Increased demand from China and Cambodia has liquidated all the old stock and the produce from the current harvesting in Vietnam. As result, there is a squeeze in the spot availability, market sources said.

It is reported that Vietnam is planning to convert black pepper to white, as it would fetch higher prices since the processing cost there is much lower compared to other white pepper producing countries.

The market sources also said that Vietnam pepper (MG 1 type) was being imported at $1,400 C&F Cochin and 25-30 tonnes went upcountry.

There is good domestic demand as many investors have entered the marketing buying spot and selling futures.