The Hindu Business Line : Buying support keeps pepper hot

On NCDEX, September contracts went up by Rs 295 a quintal to Rs 11,560 from the weekend close. On NMCE, it increased by Rs 304 a quintal to Rs 11,460.

The increase in other positions on NCDEX was Rs 323-379, while on NMCE, it was Rs 100-227.

Turnover

The total turnover on NCDEX went up by 7,744 tonnes to 40,764 tonnes from 33,020 tonnes. On NMCE, it moved up by 3,051 tonnes to 7,408 tonnes from 4,357 tonnes.

The total open interest on NCDEX stood at 24,428 tonnes against 23,356 tonnes, while on NMCE it was at 4,620 tonnes compared with 4,712 tonnes.

In tandem with the upward trend in the futures, spot prices also ruled steady at higher levels at Rs 10,200 (un-garbled) and Rs 10,600 (MG 1) a quintal.

Brazil, which was selling at low, has drastically increased its prices from $1,800 a tonne to $2,150 a tonne (f.o.b). Indonesia has raised its parity to 2,550 a tonne (f.o.b), while the Indian price ruled at $2,650 a tonne (c&f). Indians also said to have covered heavily from Brazil. They reported to have bought 350 tonnes.

Meanwhile, India did some business at $2,475-2,525 a tonne (c&f) New York last week. Where as purchases of Lampong Asta September-October positions made by the US players were said to be at $2,550-2,600 a tonne last week.

Covering commitments

The continuous spurt in the prices of late in the international market, according to market observers, could be attributed to the growing buying interest in the international market. Some of the importers in the world market, who went on summer vacation postponing their buying until their return from holidays hoping for the rates to decline, seem to have started covering to meet their commitments. This appears to have pushed up the prices.

On the other hand, the current upward trend points towards a potential severe shortage in the supply position, they said.

Surprisingly, despite reports that Indonesia has harvested 60 - 65 per cent of its current crop the prices do not seem to ease and instead it was shooting up in that origin. Given this scenario, "there is good opportunity for India to market out our produce, if available", they said.

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