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G.K. Nair

Kochi, Sept. 25 Pepper futures market on Thursday witnessed high volatility and closed marginally higher than Wednesday’s price on buying support.

The market moved up on reports that US buyers had covered from India Dec-Feb positions at combined price presumably at $3,200-3,250 a tonne (c&f).

Indian parity remained competitive due to weakening of the rupee at $3,150 - 3,175 a tonne (c&f) Europe and $3,300 a tonne (c&f) US. The US buyers are understood to have offered “string price” as they were not ready pay any premium price.

Here in the exchange investors were buying first delivered at Rs 150 a quintal above the October price and selling out their validity expired material at Rs 150 a quintal below the October price.

About 10- 15 tonnes of such material were said to be trading daily, market sources told Business Line.

In fact, hedging facility is no more in existence now while spot and futures prices are not converging. No spot seller is coming forward to sell.

Thus, the market is passing through unhealthy practices, they alleged.

October contract on NCDEX moved up by Rs 39 a quintal to Rs13,325, while November and December were up by Rs 25 and Rs 6 to Rs13,555 and Rs 13,783 a quintal respectively.

Total turnover dropped sharply by 6,294 tonne to 6,065 tonnes due tolack of activities. Net open position was up by 287 tonnes to 18,449 tonnes.

August position declined by 99 tonnes to 8,023 tonnes, while that of November and December moved up by 149 tonnes and 191 tonnes respectively.

Spot prices ruled steady at previous levels of Rs 13,000 (un-garbled) and Rs 13,600 (MG 1) a quintal on Thursday.

There was no selling pressure at all on the spot.

The growers are reluctant to part with their produce as they anticipate the prices will move up. In the international scenario, according to overseas reports, in Brazil the market was active with prices moving up to $2,800-2,850 a tonne (f.o.b) Belem.

Earlier it was traded at $2,700-2,775 at tonne (f.o.b) Belem up to December positions. India also reported to have sold an estimated 200 to 300 tonnes of black pepper on Wednesday for December-February positions.

Despite being at below the Indian parity, Vietnam was not showing any interest to offer probably for want of material, the report said.

The situation has reached such a stage that Brazil with its new crop will be at an advantageous position as the availability in India and Vietnam appears to be drying up in the coming days.

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