The Hindu Business Line : Pepper futures recover, stabilise

As a result, Indian exporters were getting orders not only from the end-users but also from others such as traders and brokers based in Europe and the US, market sources told Business Line.

Available stocks

Currently, the material is available only in India and Brazil. But, the demand is likely to be for MG 1, which has a preference over other origins in selected pockets in the overseas markets, they said. The Indian parity is, currently at $2,450 a tonne (f.o.b.). All the other origins are said to be offering at higher levels.

validity-expired stocks

The stock available in India now is 3,500 tonnes of validity-expired stocks with the investors and an estimated 2,500 tonnes of valid stock with the exchanges. The investors are not switching over to other positions and, hence, it is not being spread over to nearby or distant positions. As a result, the entire stock held at present is expected to be sold out by mid-Jan 2009, they said. Given this situation, India might be able to sell at the current prices till mid January, they claimed.

The exporters and domestic buyers were active and were seen totally relying on exchange-expired stocks. Validity expired stocks were sold at a discount.

Add to this, there is reportedly not much carry over stock in Vietnam, which is likely to have an early crop but not big, they said.

“quick-wilt” disease

According to Mr Anand Kishor, who has just returned from Vietnam after attending the International Pepper Community (IPC) meeting, “quick-wilt” disease is wide spread in pepper plantations in certain areas of Vietnam. The farmers were removing disease affected vines immediately on detection and the entire thing is burnt up so as to avoid its spreading.

Replanting is also not done in such areas for some time to come, he said. The new Vietnam crop might hit the market by late Janury or early February next year and the crop is “more or less the same as of last year”, he said.

Indonesia is said to have sold out its new crop. The new Indian crop is also estimated to be less as the output in Kerala, the main producing State, is likely to be lower. However, the crop in Karnataka would be higher, trading sources said.

All the contracts on NCDEX dropped during the week, and the fall ranged from Rs 223-311 a quintal.

On NMCE, it was Rs 290-430 a quintal. The total turn-over on NCDEX has dropped by 692 tonnes to 22,784 tonnes. Total open interest also declined last week by 219 tonnes to 10,381 tonnes.

Spot prices in tandem with the futures market trend also fell by Rs 300 a quintal to close at the weekend at Rs 10,700 (un-garbled) and Rs 11,200 (MG 1).