The Hindu Business Line : Pepper demand to pick up next month globally

The domestic demand in the coming days is to increase and the trading sources believe that the grinding industry might absorb the entire stock currently held by the exchanges.

G.K. Nair

Kochi, Aug 17 Demand for pepper in the world market is expected to pick up from next month once the buyers come back from the summer holidays.

Besides, the grinding industry will also start buying for the winter demand and the festival season is already around the corner. Hence the domestic demand in the coming days is set to increase.

Supply position

Availability in the primary markets are limited and those mainly growers holding stocks are not ready to part with it at the current level, market sources told Business Line. The supply position appears to be tight both in India and other origins. This phenomenon could push up the prices in September.

US FDA Detentions

The futures market on Saturday witnessed a downward trend on bearish activities and the consequent selling pressure in tandem with the trend in other commodities apart from reports from Brazil that there were 48 detentions of Indian pepper consignments by the US FDA during the past 12 months. However, the exporters said they were not aware of such detentions.

India has been sending out wrong signals because of the high volatility in the market due to highly speculative activities by the bulls and bear operators. “In fact the market is driven by the bulls and bear operators resulting in high volatility and because of which buyers are loosing confidence in the Indian futures market. This phenomenon requires to be rectified by the Regulator,” market sources demanded. In fact, “the small players cannot continue to loose and therefore they might be forced to withdraw. Such a situation will reduce the number of players in the market and that in turn will push down the turnover of the market,” they claimed.

International market is steady and all the other origins are offering below the Indian parity. Indonesia, because of the projected small crop appears to have reduced its selling of light berries. “Normally they used to sell a lot of light berries this time every year but this year they have not sold much so far,” they pointed.

Spot activity

There was no selling pressure on spot. The spot prices moved up by Rs 100 a quintal during the week to close at Rs 13,800 (un-garbled) and Rs 14,400 (MG 1). On NCDEX, the rise was from Rs 223 to Rs 379 a quintal. Total turn over increased by 5,813 tonnes to 41,671 tonnes. Total open interest moved up by 408 tonnes to 20,820 tonnes.