The pepper market continues to witness ‘squeezing and cornering’ and consequently high volatility last week.

Those who were keeping the market artificially high are said to be liquidating now. Switching over and additional buying was also taking place last week.

There was no domestic demand as the upcountry demand was being met by Rajasthan-based stockists, who were liquidating at Rs 400-405 a kg and on an average 2-4 tonnes of black pepper were thus being reportedly moved out to other centres in north India.

The enthusiasm shown by the buyers sends out the impression that inventories with the dealers in other States are empty as they all were not maintaining any stocks because of the high cost involved due to prevailing high prices.

As the stocks in Rajasthan are getting depleted, demand for the winter season could be expected in the coming weeks, market sources told Business Line .

The new Indian crop is expected to trickle in from mid-December.

But, there have been conflicting reports about the Indian output.

Some have claimed that it would be a bumper crop with around 65,000 tonnes while some others put it at somewhere between 55,000 and 60,000 tonnes. Actual position is yet to emerge.

Growers in some districts said the number of spikes are less per vine but each spike is full of berries giving the indication of more pepper per vine.

However, in certain areas it is not claimed to be encouraging. Anyway, general impression is that the next crop is going to be better than that of the previous season, primary market dealers told Business Line.

At present, the total availability, according to the trade, is estimated at around 10,000 tonnes and the requirement till mid-Dec, at the requirement rate of 3,000 tonnes a month would come to 7,500 tonnes.

Of the total availability, 4,000 tonnes are on the exchange platform and of this an estimated 3,000 tonnes are held by a bullish cartel, the trade sources alleged.

The carry forward stock for 2013 would be very thin, the trade claimed.

Some 459 tonnes have been marked for staggered delivery as on Saturday, they said.

At the same time, those who are holding the commodity anticipating the prices to touch Rs 500or for any special purpose might not release it till their objective is achieved.

In the international market, Malabar remained totally out-priced at around $8,500 a tonne (c&f), where as, other origins are ruling below $7,000 a tonne. Reports of bumper Indian crop have also influenced other origins making them easier.

Brazil was reportedly aggressive while Indonesia and Vietnam have brought down their prices for Asta grade to below $7,000 a tonne.

The futures market witnessed a mixed trend last week. The activities were limited. Liquidation of good quantity has taken place. Spot prices remained unchanged during the week on matching demand and supply.

Oct contract during the week decreased by Rs 295 a quintal to Rs 43,100. Nov contract moved up by Rs 65 to Rs 43,100 while the Dec contract decreased by Rs 520 to Rs 41,815a quintal.

Total turn over increased by 653 tonnes to 12,272 tonnes.

Total open interest decreased by 699 tonnes to 7,469 tonnes.

Spot prices were flat at Rs 40,000 (ungarbled) and Rs 41,500 (garbled) a quintal.

comment COMMENT NOW