The Hindu Business Line : Pepper futures decline

High volatility was witnessed. Bearish activities continued pushing down the prices. The market remained highly speculative. Spot prices also dropped by Rs 200 a quintal to Rs 12,000 (un-garbled) and Rs 12,600 (MG 1) during the week.

Wrong signals

The futures prices for nearby contracts remained below the spot price. “It is not a healthy sign”, market sources told Business Line. They said that quantitative restriction on nearby month position coupled with certain other anomalies were responsible for this kind of situation in the futures market, which is sending out wrong signals to the international market. As the fundamental remain unchanged in the world market, the prices of other origins are ruling firm. Given this situation, it is advantageous for the buyers to invest when the prices here are dipping, they added.

Downtrend

All the contracts dropped during the week. On NCDEX, the drop was from Rs 274 to Rs 415 quintal, while on NMCE, except for September all the other contracts declined from Rs 265 to Rs 528 a quintal.

Turn over on NCDEX during the week fell sharply by 59,834 tonnes to 86,595 tonnes. October witnessed the highest fall of 68,046 tonnes.

On NMCE, the turn over during the week dropped by 6,878 tonnes to 10,737 tonnes. Here also October turn over fell by 6,431 tonnes.

The total open interest on NCDEX during the week fell by 615 tonnes to 23,037 tonnes. September open position fell by 1,581 tonnes to 3,432 tonnes while the decline in Oct was 235 tonnes to 11,193 tonnes. November position increased by 964 tonnes to 4,704 tonnes.

On NMCE, total open interest declined by 453 tonnes to 1,723 tonnes.

Price fluctuation

Even an international report has said that world over except for India the prices were fluctuating only slightly and were almost ruling firm.

According to the Brazilian Pepper Trade, “The buyers although very discretely are buying and for the time the exporters cash is strong one cannot foresee big changes”.

Brazil was offering B1 at $3,350-3,450 (f.o.b.) while Vietnam has quoted FAQ 500 GL at $3,050-3,200 (f.o.b.). The Indian parity for Asta grade continued to remain competitive.