Pepper August contract gained Rs 40 and settled at Rs 42810/quintal on hopes on rising exports along with spot demand. Overall trend looks positive however as traders expect demand to pick up in coming weeks that could support the prices. Trading activities remained low but expectations of increased export and domestic demand in coming weeks could support the prices at these levels as per market sources. 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. 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 Indonesian production expected to rise to 41000 tonnes up from 33000 tonnes. Malaysian production also expected higher at 26500 tonnes vs 25600 tonnes. Indian production expected to decline by 5000 tonnes at 43000 tonnes. Spot pepper gained 49.75 rupees to 41354.75 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs 43165/quintal while low of Rs 42625/quintal. Now support for the pepper is seen at 42568 and below could see a test of 42327. Resistance is now likely to be seen at 43108, a move above could see prices testing 43407.

Trading Ideas:

Pepper trading range for the day is 42327-43407.

Pepper ended with gains on hopes on rising exports along with spot demand.

Overall trend looks positive however as traders expect demand to pick up in coming weeks that could support the prices.

NCDEX accredited warehouses pepper stocks gained by 10 tonnes to 1570 tonnes.

Spot pepper gained 49.75 rupees to 41354.75 rupees per 100 kg in Kochi market.