Pepper futures on Monday shot up on strong buying support and bullish activities. All the contracts after the usual volatility closed much above the weekend closing. Bulls got into the driving seat, market sources told Business Line . Premium for further up positions came down sharply. Consequently, investors were liquidating farm grade and validity expired stocks at Rs 4 a kg below February price and buying back their sales. Since the availability of physical pepper was tight, exporters were also buying validity expired stocks. Tightening of all the loose ends by the exchange warehouse is also said to have paved the way for arresting manipulations. Strong additional purchases were seen.

Total turnover increased several fold. Open interest also increased substantially showing huge additional buying. February contract increased by Rs 475 to close at Rs 23,329 a quintal. March and April contracts soared by Rs 495 and Rs 502 respectively to close at Rs 23,882 a quintal.

Total turnover surged by 17,871 tonnes to 23,249 tonnes.

Total open interest went up by 1,470 tonnes to close at 15,273 tonnes. Spot prices in tandem with the futures market and good buying support went up by Rs 300 to close at Rs 22,000 (un-garbled) and Rs 22,800 (MG 1) a quintal. Inter-state dealers and exporters were covering whatever new pepper arrived afloat.

But, for small and medium operators they had to validate expired stocks.

Upcountry buyers were buying directly from the primary markets. But, availability was limited. They are waiting for the Coorg pepper to arrive while overseas buyers were hoping the arrival of Vietnam new crop will pull down prices.

Indian parity in the international market moved up to $5,350 a tonne (c&f) and remained much above other origins. The overseas trend would be known tomorrow, trade sources said.

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