Pepper prices witnessed a bullish trend late last week as physical availability of the material was tight. However, the tug of war between both the operators led the market to end in a mixed trend.
No arrivals were there from the farm gate even though there were buyers for 500 GL at Rs 395 a kg, 550 GL at Rs 400 a kg and high-range pepper at Rs 406 and Rajkumari pepper at Rs 410 a kg. Even at this rate there were no sellers, the trade said.
On the exchange platform as availability of the material was tight as contrary to the anticipation of the trade in general no liquidation took place. This phenomenon coupled with no arrival from the primary markets kept the prices moving up, market sources said.
September contract on the NCDEX showed an increase while other active contracts declined. September went up by Rs 290 a quintal to the LTP of Rs 42,350 a quintal. October and November decreased by Rs 140 and Rs 175 respectively to the LTP of Rs 43,000 and Rs 43,000 a quintal.
Total turn over fell by 8,491 tonnes to end at 8,500 tonnes. Total open interest dropped by 313 tonnes to 6,912 tonnes.
Spot prices increased by Rs 400 a quintal last week to close at Rs 39,600 (ungarbled) and Rs 41,100 (garbled) in tandem with the futures market trend late in the week.
Indian parity in the international market has gone up last weekend due to rise in the futures market prices and strengthening of the rupee against the dollar. Parity was at around $8,100 a tonne (c&f) Europe and $8,400 a tonne (c&f) for the US and remained totally out-priced.
In a major upcountry market few stockists were liquidating their stocks at Rs 390-395 a kg and consuming markets in nearby States were covering. The sales at prices below that of the producing centres are said to have slowed down demand. Besides, propaganda was being made in Jaipur, Gwalior, Indore, Delhi and Nagpur that pepper was available at lower rates locally. There was no selling pressure in Karnataka.
As pepper prices were ruling high and chances of further rise was unlikely given the easier trend overseas many of the investors were shifting to other commodities such as cardamom, market sources said.
Exports during Jan–July 2012 have shown an increase of 11.36 per cent to 11,505 tonnes from 10,331 tonnes in the same period the previous year. Imports also increased by 14.15 per cent to 8,834 tonnes from 7,739 tonnes during the period.
Overseas reports showed a bullish trend. According to a report on Saturday “Indonesia's quotes were going up after every sale, as it is getting more difficult to buy raw material in their local markets. A similar scenario reportedly exists in Brazil also. Vietnam continued to be content to ride the market up, it said.
White pepper market is said to have strengthened, and “Indonesia has grown more cautious making offers. Vietnam remains in the picture, but is not setting the market there either.”
Meanwhile another report came out claiming “what remained remains to be sold (in Brazil) is another 22,000 tonnes and total being 30,000 tonnes, while Indonesia is estimated to have about 20,000 tonnes, Vietnam about 30,000 tonnes and India and Sri Lanka together do not have surpluses to export.”
A report from Vietnam said it has exported 85,331 tonnes of pepper during Jan-Aug 2012 and of this India imported 5,296 tonnes of pepper and remained at the fifth position. Prices were showing an easier trend of late as Brazil and Indonesia are into the season to be followed by India and Vietnam.