Pepper prices may remain stable for three months

KOZHIKODE: The Agricultural Market Intelligence Centre (AMIC) of the Kerala Agricultural University predicts that the pepper prices are likely to remain firm for the coming three months as well. The market survey and the econometric analysis of pepper prices at Kochi conducted by the AMIC has predicted a price level of  Rs. 305 to Rs. 325 during September 2011 to November 2011.According to Prof K Satheesh Babu of the AMIC, the supply concerns across the globe will keep the pepper prices firm in the coming days. “The pepper trade is mainly influenced by the level of pepper production in Vietnam during the first half of the season and the level of Indonesian output in the second. There are reports that Vietnam has liquidated more than 65,000 tonnes out of an estimated current year production of one lakh tonnes. Lampung, the main source of black pepper production in Indonesia, contributing to more than 60 percent of black pepper produced by the country, has a lower output. Reports pointed out that production in Brazil is also not encouraging due to the vagaries of climate,” he said.Along with the shortage of pepper production, there is also a huge demand expected due to the festival season. “Thedomestic and international demand are likely to be pepped up by the higher festive demand from September middle onwards on account of Deewali, Dussera and Durgapuja as well as with the onset of winter in Northern India and increased demand from Europe and America as these countries stock products inadvance for the Christmas season,” Satheesh Babu said.Most of the small and marginal farmers have already sold their stocks when the prices were ruling high and the current stocks are held by large farmers, traders, exporters and investors. “The uncertainty in the share market is driving a large number of investors into investment in commodities. This type of intensive speculation is a major driving force behind pepper prices being edged up,” he added.