Sugar gains, spices drop in India

AHMEDABAD, Apr 29 (Commodity Online): The NCDEX May futures sugar prices settled at Rs. 2713 per quintal Thursday, up almost Rs 22 per quintal from the last day. Sugar futures witnessed some buying at lower levels on the heels of export permission to domestic sugar millers along with strong stockist demand ahead of summer demand. As per market sources, latest announcement of Indian government to allow the domestic sugar exports of around 0.5 million tonnes under unrestricted sales boosted the stockist demand at lower levels. Moreover, strong demand during the summer season also encouraged the stockists to stock some of the sugar at lower levels. The NCDEX Chilli futures continued the fall for fourth consecutive session on profit booking triggered by weak spot demand. Chilli 334 variety prices dropped by Rs 100 from the last close to Rs 9100 per quintal in the Guntur spot market with the total arrivals at around 55,000 bags (35,000 khammam teja). Chilli prices again came under selling pressure as the crop damage size is expected to be lesser than the earlier forecast. The NCDEX Red Chilli for June delivery dropped four per cent to the session low of Rs 9656 during the session. The contract ended the day lower by 2.56 per cent or Rs 258 at Rs 9,800 per 100 kg. Open interest dipped 5.39 per cent to 14045 tonnes, indicating profit taking. Volume traded surged to 7,985 tonnes from 6,080 tonnes. As per market sources, fresh crop arrivals are likely to remain till early May. As per news sources, export demand from Bangladesh, Malaysia is the only supporting factor for prices. However, good Chinese crop this year is grabbing all export orders from US and EU which is impacting Indian prices as of now. Spot market of Guntur will be closed from May 20 for a month due to rise in mercury levels. Black pepper dropped in the afternoon due to technical correction and on sluggish domestic demand though a tight supply situation in the spot market limited the downtrend. At NCDEX May contract Thursday closed at Rs 28380 per quintal, lower by 0.60 per cent. The benchmark May 2011 pepper contract gained by Rs 333 or 1.17 per cent to the session high of Rs 28885 per 100 kg. Open interest dipped to 10461 tonnes. According to the International Pepper Community, world pepper output this year will fall by about 6,500 tonnes against 2010 to 310,000 tonnes due to unfavorable weather conditions and pests in several producing countries. Addressing the conference held by the Vietnam Pepper Association to review its 2008-10 performance and set tasks for 2011-14, chairman Do Ha Nam said the country's total pepper output this year would be about 100,000-110,000 tonnes, the same as last year.