The Hindu Business Line : Volatility crushes pepper futures

Kochi, Feb. 12 Pepper futures market on Tuesday crashed on excessive volatility allegedly caused by the numerous “technical sell calls” by market analysts of leading brokers.

Adding fuel to fire the Forward Markets Commission has not so far taken any decision on the quantity restrictions on nearby month position. The restrictions said to have affected the exporters “as without hedging they cannot take long positions” Therefore, the delay in taking a decision on this issue would have a adverse impact on the prices and exports, market sources told Business Line.

On the other hand rumours were being spread by buyers that Vietnam would open on Wednesday at lower levels. Besides, a propaganda that imports from Sri Lanka has started arriving also contributed to the sharp fall.

With the price crash the Indian parity had dropped to $3,650 a tonne (c&f) from $3,850 on Monday. International market remained by and large quiet.

CONTRACT POSITION

February contract on NCDEX on Tuesday fell by Rs 787 a quintal to Rs 13,455. The fall in other contracts was from Rs 186 to Rs 812 a quintal.

On NMCE, February contract dropped by Rs 453 a quintal to Rs 13,500. The drop in other contracts was from Rs 303 to Rs 843 a quintal.

Turnover up

Total turnover on NCDEX shot up by 7,455 tonnes to 18,289 tonnes, while on NMCE it increased by 522 tonnes to 1,967 tonnes.

Total open interest on NCDEX fell by 1,755 tonnes to 21,523 tonnes. The February, March and April positions dropped by 11 per cent, 61 per cent and 21 per cent respectively.

On NMCE, the total open interest moved up by 113 tonnes to 1,949 tonnes.

Spot price

Spot prices in tandem with the futures market trend fell by Rs 300 a quintal on Tuesday to close at Rs 13,200 (un-garbled) and Rs 13,800 (MG 1).

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