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The pepper futures market on Monday fell sharply on heavy liquidation and selling pressure.
More sellers came forward offering at Rs 10 below the April delivery price earlier in the day and thus it was traded in good quantity at Rs 236, Rs 235 and Rs234 a kg when the April price was ruling at Rs246, 245 and Rs 244 a kg respectively. However, when the April delivery price dropped to Rs243 and below the sellers withdrew, market sources told Business Line.
Similarly, low bulk density inferior quality pepper was also traded at Rs 227 to Rs 230 a kg in small quantity. They were also said to be not ready to sell below Rs 227a kg due to a squeeze in availability. This material was not from the farmers. It is a mixture of rejected pepper bought from the exporters and then mixed with some good pepper and traded in markets where low quality material is in demand, they said.
However, bulk trading took place in good quality pepper, they said.
The futures market fell on heavy liquidation, over 400 tonnes of pepper were liquidated and 284 tonnes were switched over. April contract on the NCDEX dropped by Rs 379 to close at Rs 24,109 a quintal. May and June fell by Rs 325 and Rs403 respectively to close at Rs 24,463 and Rs24,744 a quintal.
Total turn over increased by 1,642 tonnes to close at 10,738 tonnes. Total open interest dropped by 409 tonnes to 10,756 tonnes indicating heavy liquidation.
April open interest dropped by 709 tonnes to close at 7,881 tonnes while that of May and June moved up by 236 tonnes and 48 tonnes respectively to close at 2,421 tonnes and 320 tonnes indicating switching over.
In the international market good buying by Dubai based operators and Chinese buyers from Vietnam said to have pushed the prices of Vietnam pepper up last week. The former is believed to be instrumental in pushing the Indian futures market also, trade sources alleged.
Indian parity in the international market on Monday was at $5,650 -$5,675 a tonne (c&f). The price trend in other origins would be known on Tuesday, they said.
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