The Hindu Business Line : Speculative activities continue to buoy pepper

Kochi, Jan. 8 Speculative activities continued to push up the pepper futures market on Tuesday. Investors were active in selling futures and buying fresh spot exchange delivered material even at one rupee above the January price. Processors were buying expired material for reprocessing and selling. Arrivals at the terminal market of new crop continued to remain thin with 5 to 7 tonnes. The availability, as a result, is tight and that in turn has pushed up the spot prices by Rs 200 on Tuesday.

Besides, the rupee continues to be strong against the dollar. Indian parity has gone up to $3,900-3,950 a tonne (c&f). Prices of other origins were reportedly firm and moving up. However, it remained far below the Indian parity, market sources told Business Line.

Vietnam was offering 500 GL at $3,320 a tonne (c&f) and 550 GL at $3,500 a tonne (c&f). V Asta was not on offer. White Pepper was sold at $4,980 a tonne (c&f). Lasta was trading firmer and offering at $3,400 a tonne (f.o.b.), while Brazil was offering B Asta at $3,200-3,300 a tonne (f.o.b.).

Shortage of white pepper and consequent price rise would force the other origins such as Vietnam and Indonesia to move out heavier pepper for converting into white pepper. Low conversion cost in these countries is also pointed out as an encouraging factor, they said. As a result, there is going to be a shortage of 550 GL and above and that in turn would compel the buyers to turn towards India for such materials, they claimed.

CONTRACT POSITION

January contract on Tuesday moved up by Rs 60 a quintal to Rs 14,325. The increase in other contracts was from Rs 65 to Rs 183 a quintal.

On NMCE, January contract went up by Rs 31 to Rs 14,038. The rise in other contracts except May and June was from Rs 42 to Rs 88 a quintal. May and June dropped by Rs 108 and Rs 65 a quintal respectively.

Total turnover on NCDEX went up by 4,789 tonnes to 22,084 tonnes, while that on NMCE increased by 306 tonnes to 1,957 tonnes.

Total open interest on NCDEX moved up by 771 tonnes to 21,803 tonnes. January and February positions dropped by 15 per cent and 50 per cent respectively, while March moved up by 23 per cent. On NMCE, total open interest moved up by 117 tonnes to 1,627 tonnes.

Spot prices shot up by Rs 200 a quintal on good buying support on Tuesday to close at Rs 13,600 (un-garbled) and Rs 14,200 (MG 1).

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