The Hindu Business Line : Pepper futures market crashes

Pepper futures market prices crashed on Friday on reports of raids on the premises of leading members of the commodities exchanges, alleged to have been rigging the prices.

It was evident from the pattern of trading of late that some thing unusual was happening in the market, market observers here told Business Line. Buying spot at very high prices and selling futures was a regular phenomenon. Besides, the market was witnessing wild fluctuations pushing the prices up and down.

All the future contracts on the major exchanges witnessed sharp fall.

September contracts on NCDEX was down by Rs 1,029 a quintal on Friday to close at Rs 11,940, while October and November contracts fell by Rs 1,028 and Rs 1,125 a quintal respectively. The other contracts also fell by Rs 727-906 a quintal.

September contracts on NMCE also dropped by Rs 1,104 a quintal to Rs 11,800, while October and January fell by Rs 1,075 and Rs 1,277 respectively. The drop in other positions was from Rs 840 to Rs 978 a quintal.

Turnover

The total turnover on NCDEX dropped by 18,094 tonnes to 71,908 tonnes from 90,002 tonnes, while on NMCE it fell by 3,849 tonnes to close at 8,676 tonnes from 12,525 tonnes on Thursday.

The total open interest on NCDEX on Friday stood at 25,567 tonnes compared to 26,419 tonnes on Thursday, while on NMCE it was at 5,192 tonnes as against 5,448 tonnes on Thursday.

The outstanding position (OP) for September, October and November on NCDEX was 2,818 tonnes, 15,660 tonnes and 2,839 tonnes respectively. On NMCE, the OP for October was at 3,599 tonnes.

In the international market, Indonesia was quoting L Asta at $2,800 a tonnes (f.o.b) while the Indian parity was at $2,875 a tonnes (c&f). In tandem with the fall in the futures market, spot prices also fell by Rs 500 a quintal to close at Rs 11,200 (un-garbled) and Rs 11,600 (MG 1) on Friday.