The Hindu Business Line : Cut in margin value props up pepper futures

Kochi, Dec. 28 Pepper futures market on Friday moved up on bullish activities following reduction in the margin to 5 per cent from 10 per cent of the contract value.

NCDEX has issued a circular saying that all the commodities future contracts shall be subject to a minimum of five per cent of the contract value except that in case of gold, the minimum initial margin shall be four per cent of the contract value.

The revised margin would be applicable from January 1, 2008.

However, the trading sources here alleged that the decision would help only the speculators.

They said the Regulator need to look into restriction on nearby month position and the penalties urgently as the season is just a week away. Besides, everybody would be buying nearby positions as the Vietnam new crop would arrive in the markets by March/April 2008, they said.

Indian parity at $3,675-3,700 a tonne (c&f) remains much above the other origins at present.

Arrival of the new crop is expected at the terminal market from next week, they said.

CONTRACT POSITION

January contract on NCDEX moved up by Rs 45 a quintal on Friday to Rs 13,360.

The increase in other contracts except April and May was from Rs 23 to Rs 46 a quintal. April and May dropped by Rs 16 and Rs 285 a quintal respectively.

On NMCE, January contract went up by Rs 60 a quintal to Rs 13,268. The rise in other contracts was from Rs 29 to Rs 60 except for May and June, which dropped by Rs 240 and Rs 260 a quintal respectively.

Turnover up

Total turnover on NCDEX increased by 797 tonnes to 10,10,680 tonnes, while that for January dropped by 18 per cent and February moved up by 70 per cent.

On NMCE, total turnover dropped by 453 tonnes to 879 tonnes.

Open interest

Total open interest on NCDEX went up by 190 tonnes to 18,189 tonnes. January position dropped by 32 per cent while February moved up by 47 per cent.

On NMCE, total open interest declined by 9 tonnes to 1,322 tonnes.

Spot prices

Spot prices also moved up by Rs 100 a quintal on Friday to close at Rs 12,900 (un-garbled) and Rs 13,500 (MG 1).