Last week, the Indian pepper market was active due to strong domestic demand in the context of limited supply, which created a boom in all contracts traded on the futures and spot market. .
Agents in the Tamil Nadu and Wayanad districts of Kerala state bordering Karnataka actively sought to buy raw materials directly from farmers at the final market price showing that domestic demand was strong.
Besides, the Kalady region of Ernakulam district has become a leading trading center for the trading of railway pepper from the northern market of India, mainly buyers without a bill. The second such center is the Erattupetta region of Kottayam district.
Meanwhile, the Kalpetta and Sulthanbathery areas in Wayanad district have also become the main centers of the federal pepper trade.
Supply is weak
The supply of new cases during this time was not as expected.
The first reason is the tightening, many people have liquidated a large amount when the price went up to more than Rs 400 a kg, so they are buying supplements. The second is a serious shortage of skilled workers for harvesting. Even if wages are paid up to Rs 1,000-1,200 a day, there are still no pickers. “Current workers are not suitable because they have no experience with harvesting,” said a pepper farmer in Idukki.
The third is the processing industry in recent days of buying ripe and green pepper, trade said. Those are all factors that make the supply of spot pepper even tighter.
On the other hand, the pressure increased when it was estimated that about 8,000 tons of pepper were kept in storage for food safety reasons and were accused by security agencies of showing signs of using mineral oil for preservation. Therefore, pepper execution is not available on the trading platform.
Strong demand
At the same time, domestic demand is currently very strong. All supplies in the domestic market were emptied after the liquidity of the stocks because the dealers thought that they had a chance to sell at a high price. They were sold in advance on the basis of reporting this year's pepper will be in season.
In addition, the use of small and medium units to purchase spices for processing in the winter months, which is much less, is now widespread. This phenomenon has also supported the sudden increase in demand by the end of the year. Besides, the consumer market also asserted a shortage.
Thus, there was a mismatch between supply and demand in the last week of the month and that phenomenon was reflected in the price. The bulls pushed the market prices with the support of fundamentals.
However, Indian specialty pepper for January and February deliveries is still not competitive in the international market. Currently Indonesia is said to have run out of pepper while Vietnam and Brazil also said that the volume is also very small.
On the last week of the month on NCDEX, all contracts were soaring due to strong demand in the context of limited supply. Last February, March and April contracts increased by Rs 715, Rs 2,205 and Rs 1,370, respectively, to close at Rs 38,185 a quintal, Rs 36,945 a quintal and Rs 35,325 a quintal ($ 7,109 USD / ton respectively). , 6,878 USD / ton and 6,577 USD / ton) at the end of the week.
Total turnover decreased by 4,235 tons to 7,182 tons. Total open interest dropped by 50 tonnes to 3,271 tonnes.
Spot prices during the week increased by Rs 600 on strong domestic demand while supply was weak and closed on Saturday at Rs 39,100 a quintal (US $ 7,279 per tonne) for all kinds of pepper and Rs 40,600 a quintal (equivalent). approximately 7,559 USD / ton) for MG1 selected type. (1 USD = 53.7133 Rupees)
Indian parity in the international market for spot prices in January rose to US $ 8,350 / ton (C&F). For February and March delivery respectively US $ 7,400 / ton and US $ 7,150 / ton.
All other sources said will be provided at about 7,000 USD / ton.
Source Business Line / Giacaphe.vn
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