The Hindu Business Line : FMC move props up pepper futures

Kochi, July 23 Pepper futures market ruled almost steady on Monday following the FMC decision to raise the near month level limit for members and clients to 500 tonnes and 175 tonnes, respectively, effective from end of Monday.

The decision should have come out early as for want of clear idea many players had liquidated their position in spite of having valid export contracts. Even the buyers have run away, market sources told Business Line. However, the p epper trade here described the decision as “an eye wash” and said that the FMC “does not seem to believe in hedging”. They said that 25 per cent hedging and 75 per cent speculation is not good for the trade. Besides, issues related to warehouse facilities are also allegedly causing problems to the players, they said. The total stock held by NCDEX in the warehouses was 8,365 tonnes on Saturday last, while that held in NMCE was 5,262 tonnes.

In the international market, Europe is on summer holidays while US market is keeping quiet. Meanwhile, international players in Europe who supply to industry in the US are talking down the market. Even some of the Indian exporters are also allegedly doing the same thing to cover at lower levels.

CONTRACT POSITION

Nearby positions on NCDEX moved up marginally while that on NMCE declined.

August contract on NCDEX on Monday moved up Rs 40 a quintal to close at Rs 14,843 from Rs 14,803 on Saturday. September and October went up Rs 37 and Rs 22 a quintal, respectively. November, December and January declined by Rs 2 to Rs 53 a quintal.

On NMCE, August contract dropped by Rs 64 a quintal to close at Rs 14,516 from Rs 14,579. The drop in other contracts, except December, was from Rs 124 to Rs 340 a quintal. December contract went up Rs 108 a quintal.

The total turnover on NCDEX increased by 4,733 tonnes to 16,453 tonnes while on NMCE it moved up by 748 tonnes to 1,397 tonnse.

Spot prices ruled steady at previous levels on Monday at Rs 14,000 (un-garbled) and Rs 14,600 (MG 1) a quintal.

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