If overseas reports are to be believed global pepper supply appears to be facing a squeeze despite harvesting under way in Vietnam, and as a consequence prices in all origins are ruling firm.

Aggressive buying by China from Vietnam, which has narrowed supply from the country, has also aided the market in firming up in recent days.

According to International Pepper Community (IPC), there is a shortfall in global supply this year at a time when there has been good demand in consuming countries.

Consequently, demand has an edge over the supply.

Meanwhile, according to another overseas report some of the pepper growing areas in Vietnam had received unusual rains last week and earlier which is expected to continue for another week, disrupting/delaying harvesting in the region. Vietnam farmers seem to be “much wealthier than in previous years due to the unusually high prices of virtually all the commodities they are involved in farming,” the report said.

Brazil is reportedly trading a few parcels here and there of heavy pepper for decortication, but generally are withdrawn. Buyers are showing interest for Brazil's new crop (August-Sept) shipments but sellers are unwilling despite 2011 crop prospects looking better than the previous year.

“Buyers both in the US and Europe are getting a tad nervous as they are not seeing their expected downturn in Viet prices as the new crop is being harvested. This might force them to step in very shortly,” it claimed. Thus, all the reports emanating of late from overseas have been bullish!

In India also there are concerted efforts to push up the market.

Investors were buying and selling in April, May and market, as a result, has been highly volatile.

Good quantity of farm-grade pepper was traded at Rs 229 to Rs 235 a kg depending upon the area of production and quality, to different directions last week.

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