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Pepper prices dropped marginally on Thursday despite liquidation and bearish reports following volatility and some circular trading .
Bull and bearish operators were equally responsible for the volatility, market sources told Business Line.
Market was opened firm with the Apr price at Rs40,650 a quintal and traded with high volatility and after some time Apr nosedived to the lowest level of Rs 39,265 a quintal. However, showed some upward trend during mid afternoon and just before closing moved up to Rs40,840 a quintal registering an increase of Rs1,575 a quintal from the lowest price of the day and then declined and closed marginally below the previous day. Similar pattern was seen in the case of May delivery also.
Rumours that the pepper futures market would also be closed because of the high volatility at a time the production was around 50 per cent, on the similar lines of Guar Gum said to have prompted the small and medium players to liquidate and square off, the sources said. This phenomenon coupled with reports of easier Vietnam market was taken as a tool by the bear operators who succeeded in pushing the market down, they said.
There was no selling pressure of ready pepper while arrivals of fresh pepper were also very thin.
Apr contract on the NCDEX declined by Rs40 to the last trading price (LTP) of Rs40,780 a quintal. May and Jun dropped by Rs45 and Rs205 respectively to the LTP of Rs41,425 and Rs41,855 a quintal.
Total turn over increased by 60 per cent (3,336 tonnes) over the previous days total volume to close at 8,938 tonnes, showing some circular trading.
Total open interest dropped by 354, indicating good liquidation, to close at 8,218 tonnes.
Apr open interest fell by 435 tonnes to 5,078 tonnes. May and June moved up by 69 tonnes and 17 tonnes respectively to 2,717 tonnes and 296 tonnes.
Spot prices remained unchanged at previous levels of Rs38,000 (ungarbled) and RS39,500 (MG 1) a quintal.
Indian parity in the international market was at $8,200 a tonne (c&f) for Europe and $8,500 a tonne (c&f) for the US.
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