The Hindu Business Line : Bears pull down pepper futures

September contract dropped by Rs 115 a quintal to close at Rs 13,943, much below the spot price of Rs 14,200 of MG 1. The fall in other contracts was from Rs 38 to Rs 117 a quintal on NCDEX.

Turnover up

Total turnover increased by 1,920 tonnes to 5,903 tonnes while total open interest declined by 232 tonnes to 19,874 tonnes. September fell by 444 tonnes while October and November moved up by 147 tonnes and 55 tonnes respectively.

Bears and bull operators were manipulating the market with their money power and that in turn has been compelling the small players to leave the markets. In fact, the farmers and small players have been complaining of this unhealthy trend in the market but no remedial measures had been taken so far by the authorities, market sources told Business Line.

Exporters were also shying away from taking delivery because of fear of the quality of the material. The quality parameters are not followed strictly, they alleged.

In fact, at a meeting convened by the FMC in Bangalore early this week, dealers and farmers of sugar, pepper and rubber and some chamber of commerce people urged the Regulator to introduce some mechanism to arrest this manipulation of the market apart from putting in some fool-proof mechanism to ensure quality of the material delivered, they said.

The alleged that this anomaly in the futures market has been forcing the farmers and small dealers to politically pressurise the government to do away with the futures trading in commodities. Buyers in the overseas markets are also loosing confidence in the futures market, they pointed out.

The drop in price coupled with a weakening Rupee against dollar on Friday has pushed down the Indian parity to $3,450 a tonne (c&f) .

Brazil was offering B Asta at $3,000 a tonne (c&f) and even below some times, they said.

This pepper may come to India for grinding and value addition and re-export. It could also go to Vietnam where the carryover stock is reportedly very thin. Indonesia does not seem to be interested in competing now as not only the harvesting there has been delayed but also it is projected to be less.

There was no selling pressure on spot and it remained unchanged at Rs 13,600 (un-garbled) and Rs 14,200 (MG 1) a quintal.

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