Pepper June contract dropped Rs 705 and settled at Rs 38220/quintal on profit booking due to poor demand from the overseas buyers. Reports of Indonesian Pepper production are still not clear and same as for Brazilian pepper production, until then tight supply situation is likely to keep prices firm. Pepper imports by U. S. the largest consumer of the spice declined 14.8% in the first 2 months of the year (2012) to 8810 tn as compared to 10344 tn in the same period previous year. Exports from Indonesia posted significant decrease of 42% as compared to previous year. Exports stood at 36,500 tonnes as compared to 62,599 tonnes in the last year. During February 2012 Brazil exported 1,679 tonnes of Pepper as against 2791 tn in February 2011. According to Vietnam Ministry of Agriculture and Rural Development (MARD) exports of Black Pepper in 2012 are forecasted to fall by 30 percent to around 86,000 tonnes. Traders said Vietnam, Brazil and Indonesia were selling pepper at about $200 to $300 a tonne cheaper than India. Supplies from Vietnam are good and likely to remain smooth in the short term. Spot pepper dropped -77.75 rupees to 39475 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs 39270/quintal while low of Rs 38040/quintal. Now support for the pepper is seen at 37750 and below could see a test of 37280. Resistance is now likely to be seen at 38980, a move above could see prices testing 39740.

Trading Ideas:

Pepper trading range for the day is 37280-39740.

Pepper dropped on profit booking due to poor demand from the overseas buyers.

Reports of Indonesian Pepper production are still not clear and same as for Brazilian pepper production

NCDEX accredited warehouses pepper stocks dropped by 44 tonnes to 1327 tonnes.

Spot pepper dropped -77.75 rupees to 39475 rupees per 100 kg in Kochi market.