The pepper market appears to be in the strong grip of the bulls who are pushing the prices up sharply.

Surprisingly, the prices continued to soar even after the much-awaited harvesting of the new crop in Vietnam, estimated to be over one lakh tonnes, started about a couple of months ago.

The supply continued to remain squeezed and the overseas buyers are said to be buying from India now at over $6,000 a tonne.

Brazil and Indonesia do not have much to offer and the only source at present is India.

Overseas buyers are said to have recently purchased at $6,000 and above a tonne (c&f) to meet their immediate commitments, market sources told Business Line .

The sellers who are holding some material seem to have withdrawn from the market, anticipating the prices to cross the historic Rs 300 a kg. The spot price of MG 1 had touched Rs 265 a kg about 12 years ago.

According to projections, the global pepper output is expected to be less than that of 2010 while the consumption in producing and other consuming countries have been showing a steady growth of 3-5 per cent.

All the contracts went up sharply during the week. April, May and June contracts shot up by Rs 873, Rs 1,050 and Rs 1,225 respectively to close at Rs 26,297, Rs 26,850 and Rs 27,332 a quintal.

Total turnover increased by 39,113 tonnes to close at 81,117 tonnes.

Total open interest went up by 1,738 tonnes to 14,428 tonnes showing good additional purchases.

The market also witnessed switching over to nearby positions during the week.

Spot prices soared by Rs 1,200 to close at Rs 24,700 (ungarbled) and Rs 25,500 (MG 1) a quintal on strong buying amid limited availability.

Overseas trend

The black pepper market was very dynamic during the week and prices increased at all origins.

This was due to anticipated short supply of this year crops, says the latest report from the International Pepper Community (IPC).

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