The Hindu Business Line : Pepper prices slide despite Kerala Govt intervention

PEPPER prices continued its downward trend at the terminal market here even after the Kerala Government's market intervention exercise by procurement it since last week.

Spot prices were down by Rs 100 from that of the weekend. MG1 and un-garbled were sold at Rs 6,900 and Rs 6,600 a quintal respectively as against Rs 7,000 and Rs 6,700 on January 22. New pepper was sold at Rs 5,400 - Rs 6,400 as against Rs 5,500 - Rs 6,500 a quintal last Saturday.

Futures prices also witnessed a fall. February delivery was Rs 6,918 a quintal as against Rs 7,171 on January 22. March Rs 7,031(Rs 7,289), April Rs 7,291 (Rs 7,559), May Rs 7,222 (Rs 7,487) and June Rs 7,703 (Rs 7,991).

Arrivals in recent days have picked up. However, buyers were not active and as a result only 200 bags of 60 kg were sold out of the arrival of 900 bags on Monday and Tuesday, market sources said.

"Buyers have withdrawn from the market after Sri Lanka reduced its price from $1,400 to $1,300 a tonne," they said.

According to Mr Kishor Shamji, President, India Pepper and Spice Trade Association, under the Indo-Sri Lankan Free Trade Agreement Sri Lankan pepper would be available in the major Indian markets now at Rs 58-60 a kg as against the current terminal market spot price of Rs 66-69 a kg.

Even Some of the farmers believe that Rs 75 a kg is insufficient and it should be Rs 120 a kg.

"When the dealers in Delhi, Mumbai, Chennai and other markets could get imported pepper at a lower price why should they buy from the terminal market here at a higher price?" Mr Shamji asked.

On the other hand, direct buying from the primary market and transporting to north Indian markets without paying any tax also takes place from the growing districts.

There was virtually no demand from overseas. "The international buyers are not interested," market sources said.

As against the Indian parity of $1,650 a tonne, Indonesia has been offering at $1,400 per tonne, while Brazil was not very active. Global players are, in fact, waiting for the Vietnam crop expected in March 2005, they said.

Meanwhile, the procurement sgency, Kerala State Cooperative Marketing Federation (Marketfed) has announced that the entire quantity of pepper it was procuring would be exported.

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