Indian Black Pepper Price Down on Strong Demand and Tight Supply

Black pepper prices India eased from the new high on profit taking of the gains with the NCDEX October contract ending the week up by 1.54% at Rs. 36220 after hitting new high of Rs. 37190 per quintal. The spot pepper MG-1 ended the week at Rs. 34500 after hitting a new high of Rs. 34900 per quintal in Kochi. Prices gained sharply on the back of strong demand and tight supply of the material. During the last Year IPC session in Cochin, pepper production in 2011 was projected at 309,952 mt and export of 229,710 mt with 95,442 mt of carryover stocks from 2010.

The Yellow spice futures declined after a relief rally in the first two sessions of the week. Prices drooped on selling at higher levels on slack demand, higher arrivals and strong production estimation. The daily arrivals in the Erode mandi was in the range of 6,000-7,000 bags with prices quoted at Rs. 4,500 per quintal on Friday. The weekly arrivals in Salem market was around 12,000 bags with prices were stable over the last week. The NCDEX October contract ended the week down 9.50% at Rs. 4250 per quintal.

Profit taking pulled down the cumin seed prices with October contract ending the week down by 0.82% at Rs. 15,555 after hitting the high of Rs. 16094 per quintal. The spot Jeera plunged by Rs. 300 over the last day to Rs. 13,500-14,200 per quintal on Friday with arrivals at 8,000 bags at Unjha spot.

Cardamom futures witnessed selling at recovery on higher arrivals and weak offtakes. The MCX cardamom ended down 1.11% at Rs. 741.70 after hitting the high of Rs. 827.50 per 1 kg. The total arrivals at major auction centers from 1st August till 05th September 2011 stood at 1970 tonnes against 886 tonnes last year same period with the average price at Rs. 590.63 a kg against Rs. 1341 a kg.

The NCDEX Red Chilli October ended down 1.10% over the last week on profit taking on weak export demand and steady arrivals. The daily arrivals were in the range of 40,00-35,000 bags and Chilli 334 variety traded at Rs. 9,000 per quintal in the Guntur spot market on Friday. Chilli exports declined by 38% to 54,000 tonnes while value down 4% to Rs. 510.75 crores during the period April -July 2011.

Short supply against the strong spot demand is likely to support the Cumin Seed in short term with the NCDEX October futures likely to move in the range of Rs. 15,100-16,100 per quintal. The ideal buying level is in the range of Rs. 15,100-15,200 for the targets of Rs. 15,600, Rs. 16,000 and Rs. 16,100 per quintal.

The total production of Jeera in both Syria and Turkey is likely around 45,000 tonnes (Syria is around 30000 tonnes and Turkey is likely at 15000 tonnes), down almost 10,000 tonnes from the earlier projections. This might be due to inferior quality of Jeera in these countries. As per market sources, India's total production of Jeera in the current season is likely to be around 21 lakh bags (1 bag = 60 kgs ) against 28 lakh bags reported last year. This was mainly due to sharp decline in sowing acreage of Jeera crop in Gujarat.

Category: black pepper, india pepper, Pepper, pepper demand 2011, pepper per quintal, pepper price, pepper supplay