The Hindu Business Line : Pepper prices dip marginally

Spot prices on Friday declined marginally by Rs 50 a quintal compared with last Saturday. MG1 was sold at Rs 6,300 a quintal as against Rs 6,350 during last weekend. Ungarbled fetched Rs 5,900 a quintal as against Rs 5,950 a quintal.

Futures also witnessed a decline. The prices quoted were July Rs 6,279 as against Rs 6,364 last weekend. August Rs 6,378 (Rs 6,465), September Rs 6,528 (Rs 6,616), October Rs 6,649 (Rs 6,841) and November Rs 6,897 (Rs 6,990) a quintal.

On an average 15 to 20 tonne of black pepper was traded daily at the terminal during the week. Investors were buying spot.

The domestic demand was poor due to the heat wave conditions prevailing in the North. Demand could be forthcoming once the upcountry regions receive rains. However, according to market sources, this demand would be met by pepper imported from Sri Lanka.

There is said to be an aggressive selling in Sri Lanka, and the June/July shipments are estimated at 450 tonnes. Harvesting has just begun in the island neighbour and as the crop is good, they are selling at $1,325- 1,375 a tonne delivered anywhere in India. That means Sri Lankan pepper would be available at Rs 58 a kg in the Indian market.

Therefore, buying from the terminal market at Rs 60 a kg would put the buyer at a disadvantageas the transportation and handling cost will raise the price by around Rs 6 to Rs 7 a kg.

However, according to the sources, the moisture content in Sri Lankan pepper is 13 to 14 per cent as against the permissible level of 12 per cent. Besides, it is also alleged that the pepper shipping from there is oil washed which is also against the provisions of PFA.

There has been no demand from overseas as the buyers are waiting and watching. Conflicting reports are spread overseas on the production in different countries.

Indonesia was offering at $1,450 - 1,475 and Brazil was also quoting the same price for June/July while August/September shipments were offered at $1,350 - $1,375 a tonne. Vietnam has quoted ASTA grade at $1,400 - $1,450 while 550 GL at $1,375 a tonne. Indian parity is at $1,525 a tonne.

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