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The pepper market on Friday witnessed high volatility throughout the day and all the active contracts ended far below the previous day's closing following imposition of a series of measures by the Forward Markets Commission (FMC), the trade claimed.
It opened on a firmer note and touched the highest levels and then dropped sharply and recovered to fall again. May contract was down by Rs 1,160 a quintal from the highest price of the day to the lowest level while the difference between the highest and lowest prices of June was at Rs1,245 a quintal. All the active contracts closed much below the previous day closing.
Introduction of a series of measures by the Regulator, some of which the trade here alleged as “one-sided favouring only the sellers” coupled with reports that the Centre has ordered investigation into the futures trading in certain commodities, is appear to have prompted many of the sellers to liquidate and get out of the market. This led to liquidation which in turn has aided the prices to fall, market sources told Business Line .
All the decisions came at a time when the futures prices are ruling below spot prices, they said. There were no sellers on the spot as the buyers were quoting Rs5 a kg below the May delivery prices. Sellers were quoting Rs 383 a kg, they said.
May contract on the NCDEX fell by Rs755 to the last traded price (LTP) of Rs 37,430 a quintal. June and July contracts decreased by Rs790 and Rs615 respectively to the LTP of Rs 38,000 and Rs 38,400 a quintal.
Turnover
Total turnover fell by 1,608 tonnes to close at 4,130 tonnes. Total open interest declined by 147 tonnes to 5,578 tonnes.
May open interest decreased by 409 tonnes to 3,713 tonnes indicating good liquidation while that of June and July increased by 257 tonnes and 6 tonnes respectively to close at 1,703 tonnes and 131 tonnes showing good repurchases.
Spot prices in tandem with the futures market trend and not on any selling pressure dropped by Rs500 to close at Rs36,800 (ungarbled) and Rs38,300 (MG 1) a quintal.
Indian parity in the international market fell to $7,300 a tonne (c&f) for Europe and $7,600 a tonne (c&f) for the US following the decline in futures market prices coupled with sharp fall in the value of the rupee against the dollar, they said.
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