Pepper spot prices steady on lackluster trade

Fundamental Analysis

Spot prices were quoted at steady rates due to lacklustre trades at the domestic market. Demand from overseas market has disappeared due to lower quotes of Vietnam and Brazil of pepper.

Pepper futures witnessed selling due to reports of better availability of pepper with Indonesia. If, this proves to be correct pepper prices may witness further fall in neat 2-3 days due to lower quotes offered by the Indonesian nation in the international market.

Pepper prices in short term (till end of November 2009) are expected to trade sideways to up manner due to demand from the domestic market ahead of winter season.

In the medium term to long term (December onwards) prices may depend on the demand from the overseas and domestic market, clear production estimates of Vietnam and Indian production for the year 2010, pepper price parity of the major origins such as Brazil, Indonesia, India and Vietnam.

Technical Analysis

Pepper prices (NCDEX December 09 Contract) closed at Rs.15,266/qtl lower than Wednesday’s close of Rs.15,440/qtl.

The 14-Day RSI is at 60.6 and is moving in sideways to down manner.

Outlook:

Pepper prices in the intraday may trade in sideways manner due to reports of better availability of pepper with Indonesia. In the short term (till November) Pepper prices may be determined by the lower stocks of pepper with major pepper growing nations and demand from the domestic and overseas buyers. In the medium to long term (December onwards) prices may be determined by the demand from the overseas and domestic market, Indian production for the year 2010, pepper price parity of the major origins such as Brazil, Indonesia, India and Vietnam.

Courtesy: Angel Commodities

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