Pepper October contract dropped Rs 35 and settled at Rs 43545/quintal as weak demand for Indian produce in the global market is weighing on sentiment. Rains in growing states of Kerala and Karnataka have been pressurizing the market sentiments. Supply into the domestic market is very less as farmers are anticipating further rise. Exports have been poor because Indian-origin pepper is offered at a premium in the global market compared with competitors. The global pepper market showed some improvements during the last week. India's total production of pepper is likely to decline by almost 5000-6000 tonnes from the previous estimates of 43000 tonnes to 36000 tonnes due to early rainfall in major pepper growing regions which might reduce the pepper productivity in the current year. Despite the increase in the global pepper production, International Pepper Community projected there will be global shortfall of nearly 51,000 tonnes this year. Prices are likely to face some selling at higher levels due to the weak export demand for Indian parity due its higher prices in the global markets. New crop from Indonesia is likely to reach in the market from mid September and crop size is expected to normal during the year. Spot pepper gained 261.1 rupees to 41405.55 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs 43800/quintal while low of Rs 43130/quintal. Now support for the pepper is seen at 43183 and below could see a test of 42822. Resistance is now likely to be seen at 43853, a move above could see prices testing 44162.

Trading Ideas:

Pepper trading range for the day is 42822-44162.

Pepper ended lower as weak demand for Indian produce in the global market is weighing on sentiment.

Rains in growing states of Kerala and Karnataka have been pressurizing the market sentiments.

NCDEX accredited warehouses pepper stocks dropped by 46 tonnes to 3239 tonnes.

Spot pepper gained 261.1 rupees to 41405.55 rupees per 100 kg in Kochi market.