Pepper October contract gained Rs 175 and settled at Rs 43150/quintal as tight supply situation in spot markets supported prices but pressure seen due to recent rains that boosted prospects of higher production. Demand for pepper is weak, and chances are that output in India could rise. All these factors are putting pressure on prices. Farmers are reluctant to sell at this level and this is preventing a sharp fall in prices despite weak demand. Exports have been poor because Indian-origin pepper is offered at a premium in the global market compared with competitors. Rains in growing states of Kerala and Karnataka have been pressurizing market sentiments over last few weeks. Traders do not rule out some more corrections in rates but with Festive season demand picking up mainly from North India, the downtrend seems limited. Trading activities remained low due to rains in many parts of India but expectations of increased export and domestic demand in coming weeks could support the prices in medium term. Spot pepper gained 95 rupees to 41600 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs 43155/quintal while low of Rs 42900/quintal. Now support for the pepper is seen at 42982 and below could see a test of 42813. Resistance is now likely to be seen at 43237, a move above could see prices testing 43323.

Trading Ideas:

Pepper trading range for the day is 42813-43323.

Pepper ended with gains as tight supply situation in spot markets supported prices

Demand for pepper is weak, and chances are that output in India could rise.

NCDEX accredited warehouses pepper stocks gained by 44 tonnes to 3274 tonnes.

Spot pepper gained 95 rupees to 41600 rupees per 100 kg in Kochi market.