The Hindu Business Line : Pepper up on buying support

Futures prices were Oct Rs 6,600 as against Rs 6,443 last Monday. Nov Rs 6,657 (Rs 6,559), Dec Rs 6,742 (Rs 6,643), Jan Rs 6,795 (Rs 6,638), Feb Rs 6,965 (Rs 6,808) and Mar Rs 6,994 (Rs 6,850) a quintal.

All exchanges have shown an upward trend last week. Some buyers, the local arm of the international players, have shown buying interest. Twenty to 30 tonne were traded to fulfil their Sept commitment. Besides, those who bought spot liquidated it and bought futures, which has pushed up the futures prices also for October delivery. Added to this, because of the ensuing festival season there has been good demand from the domestic market.

The weekly turnover at the terminal market here has shown a declining trend as it has fallen from 20,230 quintals during August 30 - September 4 to 11,810 quintals during September 20-25.

There has been demand for MG 1 from some pockets in Japan, Australia, Canada and the European Union when our parity remained at $1,400 - $1,450 - $1,475 a tonne. However, as soon as the price moved up to $1,500 a tonne, they have withdrawn, Mr Kishor Shamji, President, India Pepper and Spice Trade Association told Business Line.

He said that the prices would be negatively affected by the increase introduced by some of the liners. Market reports peg Indian stocks at around one lakh tonnes by early next year. This is substantiated by the decline in prices of MG 1 of late, which is by and large on par with the other origins, he pointed out.

Meanwhile, harvesting in Brazil is likely to be delayed and would reach the full swing by mid-Oct. Brazil is currently offering at $1,250 -$1,275 a tonne.

According to trading sources, the overall production in India would be up by 20 to 25 per cent touching around 75,000 tonnes. The domestic market absorbs around 50,000 tonnes. The production in the Coorg region of Karnataka is said to be almost double from that of last year touching about 20,000-25,000 tonnes.

However, the crop in Wayanad district of Kerala where vines were destroyed in the severe drought early this year is likely to be less. Add to this, there are reports of quickwilt disease in certain areas such as Mullankolly and Pulpally.

Though there has been an increase in domestic market, it is not reflected fully on the terminal market due to the direct movement of pepper from primary sources evading taxes.

The imports have also picked on late. During August 1-17 total imports stood at 579.18 tonnes.