The Hindu Business Line : Pepper rules steady

The futures prices on Monday were August Rs 6,197 as against Rs 5,850 on July 11. September Rs 6,207 (Rs 5,910); October Rs 6,148 (Rs 6,055); November Rs 6,367 (Rs 6,150) and December Rs 6,429 (Rs 6,200) a quintal.

The upward trend is resultant from the increase in prices of Sri Lankan pepper and the reported decision of the Kerala Government not to sell the pepper procured by its agency in the domestic market.

Exploiting the buying pressure from India, sellers in Sri Lanka have not only raised the price from $1,175 a tonne to $1,300 a tonne but also stopped offering consignments till Auguts 15, market sources here told Business Line. This has resulted in the landed price "more or less equal to our price", they said.

Last week, prices had slid on rumours that the State Government agency might sell the 4,800 tonnes of pepper it had bought as part of its market intervention operations to arrest the price fall. However, the Government, which has been trying to secure an export subsidy for pepper from the Centre, is reported to have decided against sell it in the domestic market and the entire quantity could be exported. This made a positive impact in the market, they said.

The buyers were seen active, they said. Add to this, rains in the north Indian states were expected to raise the demand in the coming days, they said. Currently, there is no selling pressure here as the growers are not interested to part with their produce at the prevailing prices.

Meanwhile, imports continued to rise. In May, around 2,000 tonnes of pepper were imported, and of this, about 90 per cent was from Vietnam. A chunk of the imports was by the oleoresin industry.

There is no demand from overseas as the international players are waiting for the prices to drop. Vietnam pepper has been quoting $1,450 a tonne, while Brazil at $1,500 a tonne. However, confusing reports are originating from the US markets that Indonesia has reduced its price to $1,350 a tonne.

Indian parity is at $1,450-1,500 a tonne.

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