Pepper February delivery dropped Rs 145 and settled at Rs 29435/quintal as absence of strong demand on export front and falling Dollar vs Re rates kept pressure on prices. Fresh arrivals are very low in the spot markets.
Supplies are not picking up because overall production is down. Buyers are reportedly waiting for the new crop arrivals from India and Vietnam in mid-Feb before making fresh significant queries.
Industry officials are estimating 43,000-45,000 tonnes of domestic Pepper output for 2012, compared with 49,000 tonnes last year.
However with Indian production expected lower due to adverse weather, lower acreage and a fall in productivity, any rise in exports could support the prices at these lower levels.
Supplies from the new season crop have started arriving in small quantities in southern Kerala and Karnataka states.
Pepper imports by U.S during April to November 2011 surged marginally by 1.58% to 64,276 tonnes as compared to 63,274 tonnes during the same period in 2010-11.
Indonesia remained the major supplier to U.S. in the above mentioned period.
Spot Pepper dropped -62.5 rupees to 31000 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs 29940/quintal while low of Rs 29375/quintal.
Now support for the pepper is seen at 29227 and below could see a test of 29018.
Resistance is now likely to be seen at 29792, a move above could see prices testing 30148.
Trading Ideas:
Pepper trading range for the day is 29018-30148.
Pepper ended weak as absence of strong demand on export front and falling Dollar vs Re rates kept pressure
Supplies are not picking up because overall production is down.
NCDEX accredited warehouses pepper stocks dropped by 32 tonnes to 3393 tonnes.
Spot pepper dropped -62.5 rupees to 31000 rupees per 100 kg in Kochi market.
Courtesy: Kedia Commodities
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