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Pepper market on Thursday dropped on liquidation and bearish activities with all contracts falling sharply.
The market opened on a positive note and hit the highest price of the day and traded with high volatility to drop later, and in the afternoon session, touched the lowest price of the day and recovered slightly at the closing.
August recorded the highest volatility today, market sources told Business Line .
They said the introduction of 3 per cent additional margin, coupled with the bearish activities, forced the small and medium operators to liquidate straight away.
Selling pressure
In fact, there was no selling pressure on the spot pepper in tandem with the futures market trend.
Tug-of-war between the bull and bear operators continued to be there, they alleged.
About 3,900 tonnes of pepper are outstanding in June and according to the trade, the operators who had taken delivery of large quantity in May, are likely to take delivery of nearly 2,000 tonnes of June, they said.
June contract on the NCDEX fell by Rs 633 to close at Rs 29,004 a quintal. July and August were down by Rs 533 and Rs 399, respectively, to close at Rs 28,740 and Rs 28,738 a quintal.
Total turn over
Total turn over increased by 1,210 tonnes to 8,934 tonnes. Total open interest dropped by 598 tonnes to 10,965 tonnes.
June open interest fell by 979 tonnes while that of July and August moved up by 254 tonnes and 102 tonnes, respectively, to 5,389 tonnes and 1,327 tonnes, showing heavy liquidation and switching over.
Spot prices fell in tandem with the futures market trend despite having no selling pressure by Rs 200 to close at Rs 27,200 (ungarbled) and Rs 28,000 (MG 1) a quintal.
International market
Indian parity in the international market dropped to $6,700 a tonne (c&f) and remained above other origins.
However, the reaction of other origins especially Vietnam and Indonesia, as to there would be any reduction in their prices, would be known tomorrow, they said.
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