Pepper October contract dropped Rs -80 and settled at Rs 43210/quintal on weak demand and recent rains that boosted prospects of higher production, though a tight supply situation in spot markets limited the downtrend. Black pepper production in the next season in Karnataka may be around 22,000-25,000 tons, in Kerala it may be around 25,000-28,000 tons and around 5,000-7,000 tons in Tamilnadu. But according to public ledger magazine black pepper production in 2013 may be around 65,000 tons in India, but crop will be delayed by one month. Arrival on new black pepper has been started in at Kolam and Tiru Anantpuram in Kerala and it offered at Rs 13,500-15,000 a quintal. Black pepper dealers of Rajasthan have brought out their stock of black pepper around 2,600 tons on the news of higher black pepper production. Black pepper production in the world may increase by 7 per cent and be around 3.20 lac tons, while production was reported 2.98 lac tons in 2011. Black pepper production in Vietnam may increase by 10 percent and 24 per cent in Indonesia. Pepper arrivals increased to 120 quintals from 80 quintals and offtakes jumped to 120 quintals from 80 quintals over previous close. Spot pepper dropped -223.55 rupees to 41876.45 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs 43670/quintal while low of Rs 42460/quintal. Now support for the pepper is seen at 42557 and below could see a test of 41903. Resistance is now likely to be seen at 43767, a move above could see prices testing 44323.

Trading Ideas:

Pepper trading range for the day is 41903-44323.

Pepper ended lower on weak demand and recent rains that boosted prospects of higher production

Black pepper production in the next season in Karnataka may be around 22,000-25,000 tons

NCDEX accredited warehouses pepper stocks dropped by 48 tonnes to 3292 tonnes.

Spot pepper dropped -223.55 rupees to 41876.45 rupees per 100 kg in Kochi market.