Pepper prices at the Kochi terminal market have crossed the ₹500-a-kg-mark and sustained the northward movement in the last one week, increasing by ₹26 per kg.
Cheered by the bullish trend, growers attribute the surge to lower production, coverage by inter-State dealers to meet the time-bound commitment of the industry at lower rates.
Quantities offered at the terminal markets were about 200 tonnes in the past week. Prices of ungarbled varieties are ruling at ₹514 a kg, while garbled varieties quoted at ₹534.
The high prices have forced farmers to hold back their produce anticipating further increase in prices.
Kishore Shamji, a pepper trader in Kochi said, a majority of farmers are cash-rich and have the capacity to hold back their stock, thanks to multi-crop farming. The market is in an upward trend due to rising industrial demand, mainly from masala manufacturers. If the demand sustains, this would further perk up prices in the coming days.
This year, the production of pepper has declined and the availability is low after the first round of picking. Growers fears of a production shortfall in the current season have turned out to be true with the output estimated at 45-50,000 tonnes compared with last year’s 60-65,000 tonnes.
Shamji said the rising demand in Tamil Nadu has forced buyers to procure pepper at farm gates at ₹530 in the cash-and-carry method. Similarly, Gudalur and Erode-based processors are active in Karnataka to procure the commodity at farm gate rates.
Shamji also raised concern about rising imports from Sri Lanka which stood at 1,289 tonnes in January compared with 716 tonnes in January 2021 and 67 tonnes in January 2019. Inter-State dealers who have a commitment to meet the industrial demand are depending on imported pepper at ₹485-495, he said.