The pepper market on Tuesday fell sharply, which some in the trade viewed as a technical correction after being pushed up artificially but supported by market fundamentals.

There was liquidation in first two active contracts while the third witnessed a switching over, market sources told Business Line .

The selling pressure yesterday to meet the expenses on account of Milad-e-Sheriff and Onam festivals was said to have influenced the market today.

However, the arrivals today was at 20 tonnes and that was traded at Rs 405, 409 and 411 a quintal, depending upon the quality, grade and area of production, they said.

Under the staggered delivery system, a total of 964 tonnes were delivered. Now a seller can walk away by paying 1.5 per cent penalty in case of default because the spot price is ruling much below the futures market price, they said..

August contract on the NCDEX fell by Rs 1,005 a quintal to the last traded price (LTP) of Rs 44,600 a quintal. September and October contracts also decreased by Rs 455 and 395 respectively to the LTP of Rs 43,700 and Rs 43,925 a quintal.

Turnover

Total turnover increased by 271 tonnes to 3,554 tonnes. Total open interest decreased by 285 tonnes to close at 6,530 tonnes.

August and September open interest fell by 243 tonnes and 161 tonnes respectively to 939 tonnes 4,489 tonnes while that of October increased by 118 tonnes to 1,051 tonnes.

Spot prices in tandem with the futures market trend dropped by RS400 to close at Rs40,600 (ungarbled) and Rs42,100 (garbled) a quintal.

Indian parity in the international market was at around $8,100 a tonne (c&f) Europe and $8,400 a tonne (c&f) USA. There are reportedly chances for export if the parity slipped to below $8,000 a tonne (c&f) as some of the buyers who prefer only Malabar have shown interest, they claimed.

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