Pepper November contract gained Rs 160 and settled at Rs 43235/quintal  due to limited supplies and lesser stocks, though hopes of an increase in output because of revived rains and weak exports capped the upside. Pepper output is expected to be steady or slightly higher than the last season. As of now, supplies are very less, but could improve with the arrival of the new crop. The delayed monsoon is expected to help the growth of pepper vines. In Kerala and Karnataka, the leading pepper producing states, the crop is harvested from December to February. Higher arrivals of the crop in International markets has been preventing prices from shooting up a lot even as demand picked up moderately. On the International front, better crop expectations from Indonesia and Sri Lanka and better crop and stock levels in Vietnam have also prevented the rates from rising a lot in the short term. Latest reports keep production estimates in Vietnam at 1.35-1.40 lakh tonnes vs 1.0-1.10 lakh tonnes of the earlier estimates. But higher export estimates as per Vietnam Pepper Association could perk up prices in medium to long term (exports expected at 120,000 tonnes up more than 20% in value) With Indian production expected lower due to adverse weather, lower acreage and a fall in productivity. Spot pepper dropped -115.75 rupees to 42200 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs 43400/quintal while low of Rs 43020/quintal. Now support for the pepper is seen at 43037 and below could see a test of 42838. Resistance is now likely to be seen at 43417, a move above could see prices testing 43598.

Trading Ideas:

Pepper trading range for the day is 42838-43598.

Pepper inched up due to limited supplies and lesser stocks, though hopes of an increase in output capped upside

Pepper output is expected to be steady or slightly higher than the last season.

Latest reports keep production estimates in Vietnam at 1.35-1.40 lakh tonnes vs 1.0-1.10 lakh tonnes of the earlier estimates

Spot pepper dropped -115.75 rupees to 42200 rupees per 100 kg in Kochi market.