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G.K. Nair

Kochi, Nov. 3 Pepper futures shot up on good buying support and amid reports of tight supply position.

Operators bought pepper from the spot market and sold in the futures market. The operators were said to be buyers for MG 1 exchange delivered at warehouses at October price.

Reports of Storm Mirinae hitting Vietnam’s Central Coast on Monday have created an apprehension in the market about the availability of pepper from the world’s major producing country and that pushed up the market. The delay in the onset of the North-East Monsoon over the growing areas of Kerala is also contributing to the upward swing in the prices, trading sources said.

There was good domestic demand. Buyers from the four major hubs – Delhi, Jaipur, Gwalior and Indore – were buying. They are said to be capable of holding thousands of bags of stocks. In fact, they control the entire North Indian centres, trading sources told Business Line.

According to them 50 to 60 tonnes of exchange delivered pepper and an equal volume of farm-grade pepper were traded on Tuesday. Good buying and selling activity was reported in the spot market, in line with the hectic activities on the futures market, they said.

Some of the dealers and growers in the primary markets are releasing their stocks while others are holding back for the prices to cross Rs 15,000 or Rs 17,500 a quintal, they claimed.

November contract on NCDEX shot up by Rs 330 a quintal to close at Rs 15,340. December and January contracts went up by Rs 326 and Rs 358 respectively to close at Rs 15,533 and Rs 15,695 a quintal.

Total turnover increased by 5,911 tonnes to 8,963 tonnes. Total open interest moved up by 310 tonnes to 10,497 tonnes. November open interest dropped by 500 tonnes while that of December and January increased by 782 tonnes and 28 tonnes respectively.

Spot prices also shot up by Rs 300 to close at Rs 14,400 (un-garbled) and Rs 14,900 (MG 1) a quintal on Tuesday.

Indian parity moved up to $3,400 a tonne (c&f) following the rise in futures market coupled with weakening of the rupee against the dollar. Reported tight availability position in other origins is keeping the prices firm. An overseas report on Tuesday said Lampong touched firmer on black but was easier on white. USA buyers were said to be not willing to pay higher than $3,000 a tonne for MLSVE Asta.

Prices quoted for different origins for each tonne c&f New York were MG1Asta $3,400-$3,500; Vietnam Asta $3,300; Lampong Asta $3,300; Ecuador Asta $3,150-$3,175 (very limited availability); and Brazil Asta $2,850 a tonne (fob).

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