Pepper prices turned hot on Tuesday on strong domestic demand amid tight supply. All futures contracts on the National Multi Commodity Exchange (NMCE) ended much above the previous day closing. Spot prices also continued to surge.

On Wednesday, 30 tonnes of fresh crop arrived and 35 tonnes were traded at ₹500-515 a kg, depending on the quality, bulk density and area of production, market sources told Business Line . Besides 20-25 tonnes of validity expired stocks were also traded at ₹520 a kg.

Fresh pepper arrived from southern districts of Kerala and the high ranges. Harvesting in Wayanad and Karnataka is yet to begin, they said. An estimated 600 tonnes of validity expired stocks reported to have been released.

Apart from this, a good quantity of farm-grade pepper held in the warehouses in Chertalai of Kerala's Alappuzha district has been released. It was traded at ₹510-512.

As the grinding industry has been active during winter, all small and medium units have exhausted their stocks. In fact, upcountry pipelines are empty. Hence, all big, small and medium units and the end users are out to buy, aiding the price rise.

A strong rupee against the dollar also pushed up export prices. February and March contracts on the NMCE increased by ₹830 and ₹975 respectively to ₹52,630 and ₹53,300 a quintal.

Total turnover and net open position remained unchanged at 6 tonnes and 22 tonnes respectively.

On the IPSTA, February and March contracts ruled steady at previous levels of ₹52,380 and ₹50,560 a quintal respectively.

Spot prices shot up further by ₹300 a quintal to ₹50,400 (ungarbled) and ₹52,400 (garbled) a quintal.

Export prices were $8,700 a tonne (c&f) for Europe and $8,950 a tonne for the US. Indian pepper was priced. Vietnam and Brazil were reported to have offered Asta grade pepper at $7,700 a tonne.

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