Pepper trade up as spot prices increase

Black pepper trade is all charged up with the spot price for garbled MG1 shooting up by Rs 150 per quintal in last three days to Rs 6,350. However, the gap between Indian market and global markets further widened by $275 per tonne.

Exporters said the increase in prices in Karnataka was the main factor behind the spurt in prices here. Karnataka traders are now selling pepper at a price of Rs 6,200, which they sold at Rs 5,500-5,800 few weeks back.

In Karnataka stocks have dropped drastically, that have resulted in increase in prices. Short covering by a group of traders from Malabar region also caused the sudden increase in spot and futures prices in Kochi.

In global markets, including Vietnam, there is a slowdown in trading due to lower offtake by the major consuming countries such as the US. At present, Vietnam is selling at lower rates of $1,170 for 500 gm/litre and $1,120-1,125 (550 gm/litre).

Price of ASTA grade in Vietnam is in the range of $1,270-1,280. Vietnam is now selling aggressively and in July alone they had exported 8,254 tonne of pepper, of which the US had bought 1,500 tonne.

India had imported 485 tonne of pepper from Vietnam in July, Russia had bought 471 tonne and and Pakistan bought 316 tonne from Vietnam.

Lower quotations by Vietnam exporters forced Brazil and Indonesia to lower their prices to $1,300 for ASTA.

Experts said globally there was a slowdown in the pepper trading as new crop was expected in countries like India within three months.

The latest parity in India's and world prices is $1,575 and export is almost nil at present.

The increased activity in the futures market by a section of traders ahs resulted in the current scenario in the Indian pepper market.