Pepper futures on Thursday fell sharply on heavy liquidation by weak players on bearish reports such as arrival in full swing of Indian new pepper will start next month besides new crop in Vietnam would also hit the market next month and so on.

Weak players, who were in a dilemma on such bearish forecasts and expert analyses, started liquidating.

Even buying of MG 1 at higher levels could not sustain the market. On the spot some stray trading took place here and there and as the market started declining sellers withdrew, market sources told Business Line .

Surprisingly, so far, this year no new pepper in worth mentionable volume has arrived in the market and according to growers in Idukki and Pathanamthitta districts the crop is very thin due to unfavourable weather which was prevailing at the time of flowering and thereafter. They attributed the non-arrival of the material even almost six weeks after the normal arrival time to the poor crop and the good buying by returning Sabarimala pilgrims on their way from the two growing districts. At the same time, lack of overseas support for the Indian pepper which remained out priced in the international market was pointed out as a reason for the fall.

Apprehensions that there are 8,400 tonnes of pepper available on the exchange in January with hardly 14 working days left led the weak players to liquidate, they said.

Since the north Indian weather at present is suitable for the grinding industry domestic demand from it is likely to emanate now as their long wait for the new crop might turn out to be time consuming, trade sources claimed.

January contract on NCDEX dropped by 311 tonnes to close at Rs 22,823 a quintal. February and March fell by Rs 277 and Rs 275 respectively to close at Rs 23,131 and Rs 23,357 a quintal

Total turnover dropped by 1,273 tonnes to 10,755 tonnes. Total open interest dropped by 190 tonnes to close at 13,429 tonnes. January open interest fell by 625 tonnes showing liquidation and switching over to February. February open interest increased by 449 tonnes while March was down by 17 tonnes, they said.

Spot prices

Spot prices for want of buying support and in tandem with the futures market trend dropped by Rs 200 to close at Rs 22,000 (MG 1) and Rs 21,500 (ungarbled) a quintal. Indian parity in the international market was at $5,250 a tonne (c&f) and remained out priced, they said.

According to an overseas report, today pepper markets were inactive in the US . Prices quoted for black pepper of different origins in dollar per tonne c&f New York were MG 1 asta – 5,375-5,475; Malabar faq 500g/l – 5,075-5,100 fob; Lampong asta – 5,150; Brazil B2 - 500g/l – 4,800-4,900 fob; Brazil B1 - 560g/l – 4,900-5,000 fob; Brazil B asta -5,000-5,100 fob; and Vietnam asta – 5,150 Jan/Feb.

White pepper in dollar/tonne c&f were Muntok- 7,600 and Vietnam double washed – 7,300.

Related Topics
comment COMMENT NOW