The Hindu Business Line : Pepper futures market crashes

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Kochi March 5 Pepper futures market on Monday crashed mainly due to non-availability of space in warehouses and excessive speculation that was prevailing in the market.

Also the fall in the equity market and the commodity markets world over has also contributed, market observers here told Business Line.

Non-availability of space in the warehouses of the exchanges said to have resulted in stranding of about two dozen trucks loaded with the goods without unloading, for instance in Alappuzha, they said.

Those who had sold the goods during the past two weeks are unable to deliver the commodity for want of space in the warehouses. They are finding it difficult to meet their commitments. This has contributed to the fall in the futures market even though the fundamentals remained firm, they said.

Besides, there were rumours that Vietnam pepper was down by $100 a tonne and that has also paved the way for the drop, they said.

On NCDEX, March contract fell by Rs 687 a quintal to close at Rs 11,677. The fall in other contracts was from Rs 677 to Rs 733.

On NMCE, March contract fell by Rs 696 a quintal to close at Rs 10,911 from Rs 11,607. The drop in other contracts was from Rs 531 to Rs 702 a quintal.

Turnover

The total turnover went up by 31,576 tonnes to 40,344 tonne on NCDEX, while it increased by 2,939 tonnes to 4,780 tonnes on NMCE.

The total open interest fell by 803 tonne to 29,671 tonnes on NCDEX. March position fell by 1,503 tonnes to 9,598 tonnes, while the April position improved by 299 tonnes to 11,006 tonnes as also May by 272 tonnes to 5,689 tonnes.

On NMCE, total open position dropped by 161 tonnes to 5,267 tonnes, while Mar position fell by 291 tonnes to 3,200 tonnes.

Spot prices

The spot prices in tandem with the futures market trend dropped by Rs 200 a quintal to close at Rs 11,200 (un-garbled) and Rs 11,800 (MG 1). No sellers were coming forward following the fall in prices.

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