The pepper market last week witnessed the usual volatility and at the end the prices on the futures market showed a mixed trend with marginal difference.

There was slow down in the market as is evident from the sharp fall in turn over and open interest during last week, trade sources said.

Probably, for the first time in the history of the exchange, a large volume of 3,389 tonnes have been opted for delivery of May. The market has, however, expressed apprehensions of possible default given the recent such experience, and some in the trade told Business Line, “we foresee some likely default taking cues from the previous experience”. If such a situation emerged then it would affect the credibility, they alleged.

On the spot there was good buying interest for farm grade pepper and dependent upon the quality and area of production some business was transacted at Rs 286 to Rs 290 a kg.

Karnataka was offering ungarbled pepper at below Rs 280 anywhere in India evading tax and several upcountry buyers were said to have turned towards these areas, trade sources claimed. Domestic demand is by and large met by purchases from Karnataka.

Good buying interest amid limited availability has aided the spot prices to move up during the week.

Indian parity in the international market stood at $7,000 a tonne (c&f) and remained totally out priced. However, the prices of other origins have not fallen sharply so far and that leaves the impression that there is some mismatch in demand and supply. However, these markets were reportedly easier during the week.

June and July contracts moved up on the NCDEX during the week while July showed a decline. June and July increased by Rs 356 and Rs 62 respectively to close at Rs 30,585 and Rs 30,428 a quintal.

Spot prices shot up by Rs 300 to hit the highest ever level in the history of pepper trade at Rs 28,700 (ungarbled) and Rs 29,500 (MG 1) a quintal.

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