The Hindu Business Line : Pepper futures fluctuate

`Hot' fact Indonesian harvesting is reportedly delayed by four weeks besides a drop in production. Vietnam has almost sold off its crop. Indonesia was quoting $1,750 a tonne (C&F).

Kochi , June 23

Pepper futures market witnessed a highly fluctuating trend on Friday, as the international market remained active on apprehension of short supply.

Advantage India

Indonesian harvesting is reportedly delayed by four weeks besides a drop in production while Vietnam has almost sold off its crop. These factors have forced many buyers, who had not covered Jun/Jul/Aug, to buy now. Besides, the Indian rupee has weakened against dollar. Thus, the Indian produce is placed at an advantageous position, market sources told Business Line.

However, some unconfirmed reports that the Kerala State procurement agency, Marketfed, had contacted north Indian buyers as to whether they are interested in buying pepper from it, had resulted in them liquidating their stocks which in turn had negatively affected the futures market pushing down the prices at close, they said.

Negative impact

The Marketfed is holding around 2,000 tonnes of pepper procured by it last year. If the reports were true it would have a negative impact on the prices.

Consequently, the July delivery on NCDEX, which went up to Rs 6,969 a quintal, at today's trading dropped to close at Rs 6,775 a quintal as against 6,827 on Thursday.

Similar was the case with the other positions. The decline was from Rs 33 to Rs 68 a quintal.

Retains flavour

On NMCE, however, July delivery was up by Rs 18 to close at Rs 6,809 a quintal from Rs 6,791 a quintal on Thursday. Other positions also moved up by Re1 to Rs 35, except for December, which dropped by Rs 24 a quintal.

The total turnover on NCDEX on Friday was 5,474 tonnes as against 2,730 tonnes the previous day. On NMCE, it stood at 645 tonnes compared to 272 tonnes on Thursday.

Global trend

In the world market, Indian parity is at $1,700 a tonne (c&f) where as Vietnam was offering at $1,660-1,680 tonne. Indonesia, though does not have much to offer, was quoting $1,750 a tonne (c&f).

Unconfirmed reports also said that MG 1 July was traded at $1,700 a tonne in the US market. In the international market, the prices ruled high as the sellers were showing reluctance to sell despite a limited demand, they said.

Meanwhile, Brazil, which will be harvesting in Oct, was selling Oct-Dec delivery at $1,375-1,400 f.o.b.

The spot prices moved up by Rs 50 a quintal on Friday raising the price to Rs 6,550 (un-garbled) and Rs 6,950 (MG 1) a quintal in tandem with the earlier upward trend in the futures market.