The pepper market last week was dominated by a bleak outlook created by various factors and thus all active contracts ended the week below last weekend’s closing price.
The reason for the downtrend can be attributed to an estimated 6,000 tons of pepper to be released for the first time after a case filed in Indore Court to withdraw the application. Also, there is some selling pressure from the plains of Kerala state.
There are also reports that the supply in the Vietnamese market is easier, combined with the increased demand for pepper from Sri Lanka by Indian importers, for grades 525 – 550 Gr/l.
While domestic demand, which has been met mainly by supply from Karnataka state and the northern Kerala region, also slowed on anticipation of lower prices. All these factors have led to a bearish trend in pepper prices over the past week.
Besides, dealers in West Asia are also buying through their agents from the plains and high mountain regions.
Most of the pepper delivered is low density, high moisture content as unfavorable weather conditions prevail throughout the week. As a result, processing costs have increased to as high as Rs 40/kg. Processing can only be done at factories with modern facilities.
The demand for pepper is large, especially the high density variety from the high mountains of Idukki district in Kerala state and Tamil Nadu district, based on federal agents, which have been priced in cash and made at the facility. department. Meanwhile, vendors at Rajkumari in Idukki district are now said to be interested in selling pepper at Rs 420/kg. But, buyers are very reluctant to buy due to the declining market.
Most days last week, Indian pepper prices remained competitive in the international market. But, the high volatility in the exchange rate has put exporters in a difficult situation that prevents them from making any commitments to overseas buyers.
At the end of the week, pepper from other sources is reported to be firmer than at the beginning of the week, especially pepper from Vietnam is said to have an easier trend. From a price perspective, Vietnamese pepper is still the cheapest source. While the Indonesian market is extremely meager with limited supply mainly.
On the NMCE, October and November contracts fell sharply by Rs 1,370 and Rs 962, respectively, at Rs 42,909 per quintal and Rs 43,465 per quintal (equivalent to $6,841/ton and $6,929/ton). ( 1 USD = 62,7273 Rupees )
Total open interest decreased by 3 tons to 33 tons. Total sales increased 60 tons to 186 tons.
Spot prices fell Rs 600 to close at Rs 40,300 per quintal ($6,425 per ton) for bucket pepper and Rs 42,300 per quintal ($6,743 per ton) for select pepper, due to limited activity. .
Indian specialty pepper in the international market fluctuates between $7,100-7,250/ton (c&f) for Europe and $7,350-7,500/ton (c&f) for the US because of the fluctuation of the Rupee exchange rate against the Rs. USD.
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