The Indian pepper mart is currently facing a deep crisis as the stock in the country has lowered to a historic low of 3,000 tonne.
The total stock with the Comexes is estimated at this level which is hardly enough for 4-5 weeks of domestic and overseas business.
The growers, traders and stockists are completely devoid of pepper, hence local supply to terminal market is absolutely nil for the last few months. According to a leading pepper trader this is a clear indication of the serious shortage of pepper and to him this is happening for the first time in a period of 30 years.
According to market sources, delivery defaults are likely to occur in pepper trading towards the end of next month unless supply of fresh crop strengthen in next couple of weeks. This may lead to the collapse of the market system since speculative trading is still quite active.
A leading commodity exchange is said to be on a crisis management exercise and is regularly in touch with leading export houses in the country contributing 90 per cent of the Indian pepper exports, for the last couple of days. The exchange is said to be in a turbulent situation as the stock position is so weak.
The high seasonal domestic demand is being met by the stock with the exchanges and it is interesting the domestic market is having a fresh experience of MG1 grade pepper. Only the lack of overseas demand makes the market to operate without serious trouble. But this scene may change by mid-January.
The delay in the pouring in of fresh season’s crop makes the crisis more serious as terminal market is getting ‘very little’ from the southern districts of Kerala where the harvesting for the season is very active. Normally, pepper harvesting begins towards November-end and supply is active by mid-December.
But this time as per rep-orts from producing centres supply would pick up only towards the end of January. Until then, both overseas and domestic markets should manage with the meagre stock with the Comexes. This is the paradox, pepper market facing currently. It is also interesting to note that even with poor stock the prices are on a collapsing trend for the last few weeks.
