The Hindu Business Line : Pepper drifts south

UNCERTAINTY over the Kerala Government's plan to procure pepper as a market intervention exercise has pushed down the prices of the commodityafter an increase last week.

Spot prices of MG 1 and ungarbled on Saturday were Rs 6,400 and Rs 6,100 as against Rs 6,500 and Rs 6,200 respectively a quintal last weekend. Futures also showed a tangible fall. Prices quoted on Saturday were Dec Rs 6,106 as against Rs 6,382 on Nov 27. Jan Rs 6,338 (Rs 6,439), Feb Rs 6,178 (Rs 6,604), Mar Rs 6,246 (Rs 6,676), Apr Rs 6,327 (Rs 6,719) and May Rs 6,430(Rs 6,837) a quintal.

There was no selling pressure for spot as the growers are still hopeful that the government would procure pepper at a better price. On the other hand, the speculators are also playing in between, market sources said.

The Kerala Chief Minister had announced recently that the Government would procure pepper in order to arrest the fall in prices. For this purpose, an agency would be appointed to procure the produce from farmers at a price to be fixed by the Government. But, so far, nothing has emanated from the Government and the farmers, anticipating a favourable decision soon, are not releasing their crop.

Overseas demand is not encouraging as the buyers are anticipating a further fall in prices.

International players are propagating that Indonesia was offering at lower prices while substantial quantity had been bought from Brazil to cover first half and second half requirements. However, the actual position is not known, as it might be a propaganda stunt to push the prices down, Mr Kishor Shamji, President, India Pepper and Spice Trade Association (IPSTA), told Business Line.

The grinding industry has bought some pepper while the demand from other segments of the domestic market has not been to the extent expected. They are also waiting for the prices to drop, he added.