The Hindu Business Line : Rising pepper imports begin to tell on prices

Imports have gone up substantially so far this year. During January-August, 11,353.56 tonnes of pepper were imported through the Cochin Port alone, an increase of 3,236 tonnes over the corresponding period last year. Import by extractors has increased from 4,201.46 tonne in January- August 2003 to 6,271.32 tonne, while that by the re-exporters from 3,915.13 tonne to 5,082.24 tonne. Imports in September is also reported to be on the higher side.

Arrivals through other ports such as Chennai, Mumbai, Tuticorin and the ICDs in Delhi, Jaipur, Indore, Jalgaon, Pune are not available and when these figures are added, imports could be up further.

This is the main reason for the drop in pepper prices in recent weeks, market sources told Business Line.

They alleged that a good quantity of pepper imported for value-addition and re-export is entering the domestic market. The imported price of pepper is between Rs 63 and Rs 67 a kgPepper bought at Rs 63 a kg in the market here reaches the North Indian markets at Rs 72 a kg after taxes and transportation cost are included.

Re-exporters are given three months time for re-export and this could be extended twice for three months each. This gives them sufficient time for them to manipulate, they alleged.

According to them, the SAARC countries have become a hub for exporting spices of other origin to Indian markets following the recent FTAs. "We have a strong domestic market of around 60,000 tonne which can take care of our farmers," they pointed out.

On the other hand, the upcountry demand which is picking up in view of the ensuing festival season, is met by direct buying from primary markets and transporting to upcountry evading tax. This had resulted in a sharp fall in the arrivals at the terminal market. The current arrivals were just five tonnes a week, they said.

Meanwhile, international players are waiting for the prices to drop following reports of an increased production, they said.

The prices of spot pepper on Wednesday were MG 1 Rs 6,600 and Rs 6,300 a quintal as against Rs 6,700 and Rs 6,400 during the weekend. Futures prices were October Rs 6,425 as against Rs 6,531 during the weekend. November Rs 6,567 (Rs 6,579), December Rs 6,650 (Rs 6,662), January Rs 6,765 (Rs 6,777), February Rs 6,838 (Rs 6,927) and March Rs 6,866 (Rs 6,955) a quintal.