Pepper prices in India witnessed a firm trend last week with upcountry dealers being reportedly active in the primary markets.
Availability is becoming tight day by day. Availability in the exchange platform is not much.
Consequently, North Indian dealers were covering from Malabar region on a cash-and-carry basis at Rs 400 a kg, market sources said. Buyers from Tamil Nadu were covering from Idukki high-range pepper at Rs 405 a kg while those from Gudalur were buying from Bathery in Wayanad. “In fact, people were ready to buy at Rs 405 a kg. But sellers were limited. Everybody is said to be trying to buy directly from the farmers,” they said.
Activities on the exchange last week were by and large concentrated on first two contracts while there were some indications of the third contract gathering momentum as July is nearing to its maturity. Arrivals at the terminal market is bought for processing and depositing in the exchange. In fact, quantity of pepper arriving at the terminal market was very thin. Availability of spot pepper was tight, traders said.
Many operators were buying spot and selling futures, July/Aug delivery and tendering the goods on exchange platform. Overseas market sources said for the past 10 days they have seen declining prices from Lampong. However, there have been so many bookings during the last two or three days, which appears to have led to a sudden stoppage of offering of Lampong probably on the realisation that “their pricing was far too low”, they said.
This new situation could possibly prompt buyers to cover additional quantities after which the market in Indonesia could gain further strength again, they added. Meanwhile, Vietnam continued to hold prices.
In the international market, buyers were seen shifting to origins which are cheap. Malabar has already lost its preference as it is ruling very high. At the same time availability in India is also tight. On the other hand, when MG 1 can be sold at Rs 430 a kg on the exchange platform here nobody would venture into selling in the overseas markets at much lower levels, the trade pointed out.
All the active contracts last week ruled firm. July, August and September moved up by Rs 900, Rs 935 and Rs 835 respectively to the last traded price (LTP) of Rs 42,730, Rs 43240 and Rs 43,520 a quintal.
Total turnover increased by 13,863 tonnes to 26,550 tonnes. Total open interest showed an increase of 490 tonnes last week to close 5,667 tonnes.
Spot prices increased by Rs 800 a quintal last week on good demand amid tight supply to close at Rs 40,100 (ungarbled) and Rs 41,600 (MG 1) a quintal.
Indian parity was at around $7,900 as tonne (c&f) for Europe and $8,300 a tonne (c&f) for the US at the weekend.