Pepper April delivery gained Rs 765 and settled at Rs 39115/quintal on short-covering, after falling for three weeks as traders created fresh positions on the back of rising spot demand. Moderate recovery was noted for Pepper as short covering took place at the lower levels. Higher production estimates from Vietnam has been keeping sentiments slight weak in domestic and International markets. Latest reports keep the production estimates at 1.35-1.40 lakh tonnes vs 1.0-1.10 lakh tonnes of the earlier estimates. Expected higher arrivals of the new crop in International and the domestic markets and European and US exports being on the lower side some more fall in rates can be expected in the near term though medium to long term trend looks firm on expected rise in demand in coming months. With Indian production expected lower due to adverse weather, lower acreage and a fall in productivity, any rise in exports could support the prices from a medium to long term point of view. As per IPC latest estimates, global Pepper production expected to rise to 3,20,000 tonnes in 2012 vs 2,98,000 tonnes this year a rise of 7.2%. Global exports expected to rise to 2.46 lakh tonnes vs 2.42 lakh tonnes in 2011. Spot pepper gained 702.95 rupees to 38850 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs
39350/quintal while low of Rs 38155/quintal. Now support for the pepper is seen at 38397 and below could see a test of 37678. Resistance is now likely to be seen at
39592, a move above could see prices testing 40068.

Trading Ideas:

Pepper trading range for the day is 37678-40068.

Pepper gained on short-covering amid traders created fresh positions on the back of rising spot demand

Global exports expected to rise to 2.46 lakh tonnes vs 2.42 lakh tonnes in 2011.

NCDEX accredited warehouses pepper stocks gained by 40 tonnes to 1905 tonnes.

Spot pepper gained 702.95 rupees to 38850 rupees per 100 kg in Kochi market.