Pepper futures bounced back on Tuesday on good buying support and switching over amid limited availability.

All the contracts moved up substantially after remaining highly volatile. The futures market opened on a declining note. As there was no selling pressure, the market took a U-turn and moved up with high volatility and the difference between the lowest and highest price of the day was at around Rs 1,000 a quintal.

There was switching over and good additional buying.

May contract on the NCDEX shot up by Rs 477 to close at Rs 29,358 a quintal. June and July increased by Rs 454 and Rs 431 respectively to close at Rs 29,985 and Rs 30,501 a quintal.

Turnover increased by 8,353 tonnes to close at 19,958 tonnes. Open interest moved up by 308 tonnes showing good additional buying.

May open interest dropped by 706 tonnes while June's shot up by 1,018 tonnes indicating switching over and additional purchases. July declined by 7 tonnes to 755 tonnes.

Spot prices increased by Rs 300 to close at Rs 27,500 (ungarbled) and RS 28,300 (MG 1) a quintal and thus remained at the highest levels in its trading history.

In the international market, Indian parity was at $6,900 a tonne (c&f). As Indonesia is playing “hide and seek” its prices are not known. Therefore, it is not known if the Indian parity is in line with the Lampong price.

However, the Indian exporters may not have to export as it would be more beneficial if they stored the goods and availed of finance at lowest rates under the new rules and then just “go on selling and buying on the exchange platform”, market observers told Business Line .

Buyers in the overseas markets are on a wait-and-watch mode hoping the prices may come down. However, there were not much selling pressure in any of the origins, they added.

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