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Bloomberg

The international pepper market remained by and large inactive and the same situation is likely to continue till the beginning of the next month. —

G.K. Nair

Kochi, Aug. 24The pepper futures market during the week witnessed high volatility as the market appeared to have remained as a ground for the bear and bull operators’ competition.

This phenomenon had, however, not influenced other origins as the supply position is said to be tight.

The Indonesian crop has been projected to be less from its normal crop this year.

Brazilian crop, estimated to be around 35,000 tonne, will start arriving in the market in the last quarter of the year. Stocks available in Vietnam are also reportedly somewhere around 10,000 tonne.

Thus, the availability is likely to be tight and the prices can, therefore, be moving up from next month.

The international market remained by and large inactive and the same situation is likely to continue till the beginning of the next month.

Availability in the exchanges are also said to be limited while the stocks held by the farmers are in strong hands, who might not part with their produce, unless the prices moved up to their expected levels.

The domestic demand is also set to pick up because of the ensuing festival and winter season in North India.

Upcountry buyers will start buying once the market shows an upward trend. But, the market needs to be free from excessive fluctuations without any connection to spot availability.

Exporters were unwilling to commit as the coverage from farmers was found to be difficult.

In fact, India does not have much cargo to offer and the exporters are basing their quotes on the availability of cheap nearby delivery from the exchanges and adding the reprocessing charges, they said.

However, the muscle power with which the market is being manipulated, according to market sources, is not good and not well received by the small traders who are often compelled to leave the scene, market sources told Business Line.

Speculative activities in excess are not good for the market, as it will send out wrong signals to the overseas markets, negatively impacting the confidence in the futures market here, they claimed.

Prices in the futures market witnessed a decline from Rs 45 to Rs 200 a quintal for all the contracts.

The total turnover fell by 1,945 tonnes to 39,726 tonne on NCDEX at the weekend close. Total open interest declined by 1,839 tonnes to 19,991 tonnes. There was no selling pressure on spot.

Spot prices ruled steady at the previous weekend close of Rs 13,800 (un-garbled) and Rs 14,400 (MG 1) a quintal.

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