Pepper market continues to be flat and monotonous with traders? engaged in estimating the strategies of the US and Vietnam buyers. Vietnam, the largest producer, has been holding back its stock in anticipation of a global rally in the commodity on the backdrop of supply constraints, traders said. A lowering of price by Vietnam could see the market ease further while continuation of its current position would firm up the market. Traders feel that Vietnam may ease its position by 10-15% before other origins enter the market.
Unlike the past when it used to sell almost 60% of its annual crop in the first five months, the world has hardly seen any stocks coming out of Vietnam or any forward contracts. Reports suggest that inflationary pressures have forced credit rate hike in Vietnam with farmers having to sell their stocks or renegotiate credit at a higher rate. Traders also suggest that Vietnam farmers? may be under pressure to sell following reports of a global recession. The Indonesian crop comes by June followed by Brazil and other origins. Arrival pressure from these nations may force Vietnam to lower their price.
However, Kishore Shaji, a prominent exporter at the Kochi market is circumspect about the reports that Vietnam will lower its prices. ?They have learned the tricks of trade and can hold on to earn more. Figures show that Vietnam sells large portion of its stocks to African and Europe nations,? he said. ?Indonesia is tight and its only Brazil and India that are showing willingness to sell,? he added.
Arrivals at the terminal market of Kochi continue to be lower when compared with a normal market and stocks with exchanges are less when compared to the same period last year. However, Angel Commodities reports that Indian exporters may gain more with relatively lower rates attracting global buyers.