The Hindu Business Line : Bearish trend grips pepper futures market

If the bulls pushed up the market on Thursday the bears in their turn pulled it down on Friday. "An online gambling is in reality going on in the pepper futures market," market observers told Business Line.

Some of the leading international players seem to be playing to push down the prices, they alleged. An uncertain and unhealthy trend is going on, they said. Because of the high fluctuation exporters could not buy. Spot sellers are totally depending on futures.

Surprisingly, there is a big difference between the prices of same grade pepper in the two major exchanges trading in the commodity for the same contract. As a result, one could buy from one exchange and sell in the other exchange. This kind of situation needs to be looked into by the regulator, they said.

March contract on NCDEX fell by Rs 202 a quintal to close at Rs 12,385 on Friday. The drop in other positions was from Rs 121 to Rs 193 a quintal.

The March contract on NMCE dropped by Rs 159 a quintal to close at Rs 11,682. The fall in other contracts ranged from Rs 75 to Rs 290 a quintal.

The total turnover on NCDEX fell by 9,816 tonnes to 16,077 tonnes on Friday, while on NMCE it declined by 286 tonnes to 3,051 tonnes.

The total open interest on NCDEX dropped by 671 tonnes to 29,839 tonnes. The open interest for March fell by 455 tonnes to 11,217 tonnes while April dropped by 288 tonnes to 10,280 tonnes.

The total open interest on NMCE moved up by 64 tonnes to 5,343 tonnes. The March position stood at 3,565 tonnes.

On the other hand, most of the demand from north Indian markets was met by direct movement of pepper from the northern districts of Kerala and Idukki to Mangalore and Madurai by evading tax, they said.

In the international market, all the origins were ruling at previous levels. Indian parity was at $3,000 a tonne (c&f) US and at $2,900 a tonne (c&f) Europe.

The spot prices, also in tandem with the futures trend, dropped by Rs 100 a quintal to close at Rs 11,400 (un-garbled) and Rs 12,000 (MG 1) on Friday.