Financial Daily from THE HINDU group of publications
Monday, Aug 22, 2005
Agri-Biz & Commodities
Spices & Condiments
Pepper prices rule steady despite improved demand
Kochi , Aug 21
SPOT pepper prices ruled steady during the week despite improvement in domestic demand, due to increased availability of imported pepper in the market.
Spot prices on Saturday for garbled and un-garbled were at August 13 levels at Rs 6,400 and Rs 6,000 a quintal respectively. Futures prices, however, fluctuated. September delivery was sold at Rs 6,344 on Saturday as against Rs 6,448 a quintal on August 13, October Rs 6,523 (Rs 6,630), November Rs 6,755 (Rs 6,866), December Rs 6,656 (Rs 6,766), January Rs 6,787 (Rs 6,848) and February Rs 6,787 a quintal.
In view of the ensuing festival season, which has already begun with Nariyali Poornima and Raksha Bandhan, the domestic demand has started improving. But, this phenomenon has not so far reflected on the prices due to increased availability in the markets of imported pepper, market sources told Business Line.
They said that imports had gone up by 24.90 per cent during January - June 2005 from that of the same period last year. Imports up to June this year stood at 9,651 tonne as against 7,726.98 tonne and 5,196.98 tonne in the corresponding periods in 2004 and 2003 respectively. At this rate, the imports might cross 20,000 tonne this year, they claimed.
According to them the re-instatement of light pepper imports without specifically mentioning that such imports would be allowed exclusively by the oleoresin industry has resulted in imports in large quantity.
Imports from other origins are also taking place for value addition and re-exports.
Meanwhile, exports continued to show a decline. Given this scenario apprehensions are that part of the imported pepper spills into the domestic market, which in turn depress the domestic demand, they claimed. There has not been any mechanism in operation to check the quality of the light pepper, they alleged.
In the international market, the buyers are not very active and as a result, the prices have shown a declining trend. In Indonesia, prices dropped to $1,250 a tonne while in Brazil, where the harvesting is being delayed by a month, the prices quoted were $1,350 a tonne. Vietnam was offering at $1,250-1,300 a tonne. Indian parity is at $1,500 a tonne.
Pepper production in Vietnam this year is reported to be less by 10 per cent to an estimated 90,000 tonne due to the negative impact of the recent drought, which hit some of the major pepper growing provinces in 2005.
A report quoting the Vietnam Ministry of Trade has said that there was a decline of 13 per cent in its exports in the first half of 2005. Exports were made at $1,130-1,140 a tonne, which was $40 a tonne less than that of early this year.
Last year, Vietnam exported over 1,03,000 tonnes of black pepper, earning $139 million.
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