Pepper February contract gained Rs 970 and settled at Rs 37000/quintal as lesser stocks and thin supplies in the domestic market amid winter demand supported sentiment. Prices are getting support on winter demand but with the arrival of the new season crop. Pepper output is likely to be higher this season due to expectations of good yield in the top-producing states of Kerala and Karnataka. Farmers are trying to liquidate their stocks ahead of the commencement of harvesting of the fresh crop. Exports demand for Indian pepper in the international markets is also weak due to price parity. According to Vietnam Ministry of Agriculture and Rural Development (MARD) exports of pepper during Jan-Oct 2012 stood at 102,340 mt, lower by 12% as compared to 1,15,780 mt in the same period last year. Total exports in 2012 are forecasted at around 1,10,000 tonnes. Exports of Pepper from Brazil during January till May 2012 are estimated around 13369 mt. Pepper imports by U. S. the largest consumer of the spice declined 26% during January-September 2012 period to 41,923 tn as compared to 52,489 tn in the same period previous year. Exports from Indonesia posted significant decrease of 42% as compared to previous year. Spot pepper gained 162.5 rupees to 38643.75 rupees per 100 kg in Kochi market. The contract touched the intra day high of Rs 37035/quintal while low of Rs 36020/quintal. Now support for the pepper is seen at 36335 and below could see a test of 35670. Resistance is now likely to be seen at 37350, a move above could see prices testing 37700.

Trading Ideas:

Pepper trading range for the day is 35670-37700.

Pepper rose as lesser stocks and thin supplies in the domestic market amid winter demand supported sentiment.

Prices are getting support on winter demand but with the arrival of the new season crop.

Farmers are trying to liquidate their stocks ahead of the commencement of harvesting of the fresh crop.

Spot pepper gained 162.5 rupees to 38643.75 rupees per 100 kg in Kochi market.