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The pepper market on Monday bounced back after high volatility on good buying support and limited availability. All active contracts moved up significantly.
The market opened on a declining note and touched the lowest price of the day in the afternoon and then moved up sharply just one hour before the closing June shot up by Rs 1,215 a quintal from the lowest price of the day. Then it declined and closed much above the previous day's closing. July also moved up in tandem.
‘Tug of war'
The high volatility because of the “tug of war” between the operators was reflected on the turnover which showed a good circular trading. In fact, 77 per cent (3,232 tonnes) of trading took place in June while it was only 21 per cent in July. June open interest showed 127 tonnes of additional purchase, market sources told Business Line .
There was good buying interest both on the exchange platform and in the physical pepper market. Bull operators were ready to buy more at the higher levels, they said.
About 32 tonnes of fresh pepper arrived and 35 tonnes were traded today. Exporters, importers, domestic dealers all covered at prices at Rs 382 a kg for pepper from the plains, while Wayanadan material was sold at Rs 385-386 a kg. High range pepper fetched Rs 389-392 a kg.
Meanwhile, Kodagu pepper was reportedly being offered at Rs 390 a kg delivered anywhere in India. Chikamgalur and Sakleshpur material was also being offered at Rs 385-387 a kg delivered anywhere in India.
June contract on the NCDEX increased by Rs 665 a quintal to the last traded price of Rs 40,415 a quintal. July and August prices went up by Rs 610 and Rs 455 respectively to the LTP of Rs 40,865 and Rs 41,225 a quintal.
Turnover
Total turnover increased by 1,069 tonnes to 4,188 tonnes. Total open interest went up by 238 tonnes to 6,160 tonnes.
June open interest increased by 127 tonnes to 4,160 tonnes while that of July went up by 116 tonnes to 1,844 tonnes. However, August open interest declined by 5 tonnes to 145 tonnes.
Spot prices on good buying support amid limited availability and in tandem with the futures market trend increased by Rs 400 a quintal to close at Rs 38,200 (ungarbled) and Rs39,700 (MG 1) a quintal.
Indian parity in the international market was at $7,600 a tonne (c&f) Europe and $7,900 a tonne (c&f) for the US. The rise in futures market prices coupled with strengthening of the rupee against the dollar pushed up the parity significantly, they said.
Vietnam was today reportedly slightly easier. Prices quoted were black pepper 500 GL at Rs 6,200 a tonne and 550 GL at $6,500 a tonne (both fob).
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