The pepper market on Wednesday turned hot on good buying support amid tight availability and all the active contracts moved up after remaining volatile.
Rains from last night in several areas coupled with “buy today sell tomorrow (BTST)” calls from local origin national brokers are claimed to have aided the price rise.
Cued by the situation, the bull operators got into the driving seat. Due to the current unfavourable weather conditions medium and small players may not be able to process and deposit in the exchange and taking advantage of this situation, the operators pushed up the price.
It was an effort to squeeze the sellers so that they would get out of the market. The local market fundamentals are also in their favour, market sources told Business Line.
The operators have already taken delivery of around 1,000 tonnes of July delivery and of August about 500 tonnes have also been taken, they said.
According to them, 30 tonnes of pepper were traded on the spot at Rs408, Rs412 and Rs414 a kg depending upon the quality, bulk density and area of production.
August contract on the NCDEX increased by Rs 540 a quintal to the last traded price (LTP) of Rs 44,160 and Rs 44,500 a quintal.
September and October went up by Rs 500 and 580 respectively a quintal to the LTP of Rs 44,500 and Rs 44,800 a quintal.
Total turnover increased by 2,385 tonnes to 5,879 tonnes.
Total open interest also soared by 465 tonnes to 7,031 tonnes showing good additional buying.
August open interest declined by 6 tonnes 5,281 tonnes while that of Sep and Oct increased by 446 tonnes and 15 tonnes respectively to close at 1,654 tonnes and 89 tonnes.
Spot prices on good buying support amid tight availability moved up by Rs300 a quintal to close at Rs40,800 (ungarbled) and Rs42,300 (garbled) a quintal.
Indian parity in the international market was at $8,100 a tonne (c&f) Europe and $8,400 a tonne (c&f) USA. US brokers were quoted by the trade here as saying that some Indian exporters had offered at lower rates.
“When the material could be sold on the Indian exchange at a much higher price why should one venture to sell it cheaper on the overseas market, unless they have some other obligations to fulfil,” market sources here alleged.