The Hindu Business Line : Speculation keeps pepper futures firm

Investors are selling futures and buying spot NCDEX delivered. Over 1,700 tonnes of August contract, which matured on Saturday, was delivered. There was no demand either from domestic or the international market and yet the prices showed an upward trend. In fact, the market was bullish and volatile, market sources told Business Line. Short supply position continued to persist in the world market giving room for speculative activities.

Meanwhile, overseas reports said in Brazil, harvesting had started and hence, they were selling aggressively. But, normally harvesting starts here in October. Everybody in the international market is concentrating on Brazil, they said. Resellers were quoting B Asta at $1,825 a tonne. Pepper output this year in Brazil is said to be around 35,000 tonnes as against 45,000 tonnes last year. Indonesia was offering Lampong Asta at $2,425 a tonnes (c&f) while the Indian parity remained at $2,325-2,350 a tonne (c&f). The production in Indonesia is also reportedly less this year at 17,000 - 18,000 tonnes.

In the futures market September contract on NCDEX was up by Rs 70 on Saturday to close at Rs 10,482 a quintal. On NMCE, it moved up by Rs 67 to close at Rs 10,389 a quintal. The increase in other positions on NCDEX was from Rs 68 to Rs 149 a quintal, while on NMCE, it was from Rs 51-100 a quintal for all positions except November, which marginally increased by Rs 3.

The total turnover on NCDEX dropped by 4,147 tonnes to 11,661 tonnes on Saturday from 15,808 tonnes on Friday, whereas on NMCE it fell by 2,173 tonnes to 2,324 tonnes from 4,497 tonnes. The total open interest on NCDEX stood at 22,056 tonnes as against 21,332 tonnes, while on NMCE, it was 3,878 tonnes compared with 3,834 tonnes. The outstanding position for September and October was 7,724 tonnes and 10,320 tonnes respectively.

The spot prices also moved up by Rs 200 a quintal on Saturday to close at Rs 9,600 (un-garbled) and Rs 10,000 tonne (MG 1).

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