Pepper November contract dropped Rs 105 and settled at Rs 43100/quintal on hopes of an increase in output due to revived rains and as higher prices of the Indian produce dampened demand in the global market, though thin spot supplies limited the slide. India's total production of pepper during the year 2012 was estimated at 43,000 tonnes against 48,000 tonnes in 2011. India's crop dipped due to old vines, static acreage, low replanting and high labor cost. Besides, unfavorable weather conditions in 2011-12 affected the production. Goods available for export from India and Malaysia are not significant. Hence buyers look to other pepper producing countries in Southeast Asia. New crop from Indonesia is likely to reach in the market from mid-September and crop size is expected around 25,000 tonnes against 30,000 tonnes last year. Indian pepper prices were not sustaining at higher levels due to the weak export demand for Indian parity due to its higher prices in the global markets. According to the latest updates from India Pepper and Spice Trade Association (IPSTA), Kochi, Pepper arrivals increased to 200 quintals from 130 quintals and jumped to 200 quintals from 150 quintals over previous close. Spot pepper gained 168.9 rupees to 42315.75 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs 43525/quintal while low of Rs 42940/quintal. Now support for the pepper is seen at 42852 and below could see a test of 42603. Resistance is now likely to be seen at 43437, a move above could see prices testing 43773.

Trading Ideas:

Pepper trading range for the day is 42603-43773.

Pepper edged down on hopes of an increase in output due to revived rains and as higher prices dampened demand

India's total production of pepper during the year 2012 was estimated at 43,000 tonnes against 48,000 tonnes in 2011.

NCDEX accredited warehouses pepper stocks dropped by 293 tonnes to 3411 tonnes.

Spot pepper gained 168.9 rupees to 42315.75 rupees per 100 kg in Kochi market.