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Pepper market fell sharply on liquidation and switching over on Wednesday.
The market opened steady and moved up to hit the highest price of the day in the morning itself, but fell sharply and hit the lowest price in the forenoon . It continued to witness volatility but marginally in the afternoon and ended much below the previous close, market sources told Business Line .
Bull long position holders liquidated heavily while some switched over to August. They were trying to sell, but could not do so and hence resorted to liqudiation, they said.
Investors were liqudiating validity expired stocks at Rs 4 below the July delivery price and some good quantities were traded to different directions, they said.
Nobody wanted to sell on the spot at the current rates. July contract on the NCDEX fell by Rs 393 to close at Rs 26,749 a quintal. August and September contracts dropped by Rs 384 and Rs 332, respectively, to close at Rs 27,207 and Rs 27,589 a quintal.
Total turn over
Total turn over increased by 175 per cent to close at 9,740 tonnes. Total open interest dropped by 470 tonnes to close at 12,733 tonnes, showing heavy liquidation.
July open interest fell by 772 tonnes to 6,741 tonnes, while that of August and September increased by 238 tonnes and 40 tonnes, respectively, to 4,199 tonnes and 1111 tonnes, showing switching over. Spot prices, in tandem with the futures market trend and liquidation, dropped by Rs 200 to close at Rs 26,100 (ungarbled) and Rs 27,100 (MG 1) a quintal.
Indian parity in the international market was at $6,350 - $6,375 a tonne (c&f) and was very much in line with other origins. According to an overseas report today, Vietnam pepper indications were: Black FAQ min 500 GL was at $ 5,500 fob Hcmc; min 550 GL at $5,850 a tonne and Vietnam Asta at $6,200 a tonne. Vietnam double washed was at $8,100 a tonne (fob).
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