India pepper pare losses on short-covering, low arrivals

MUMBAI, June 3 (Reuters) - Indian pepper futures, down in early trade on sluggish export demand, pared losses on short-covering and tight supply situation, analysts said. "The market was falling continuously for the last few days. So some short-covering emerged," said Shardul Sharma, an analyst with Sharekhan Commodities Pvt Ltd.

The benchmark July contract has fallen about 12 percent in the last seven trading sessions.

Export demand is sluggish from Europe and U.S., said Vibhu Ratandhara, an analyst with Bonanza Commodity Brokers Pvt Ltd.

However, prices are likely to rise in coming days due to a tight global supply situation, he said.

The crop in Vietnam, the world's largest producer and exporter, is seen at about 80,000-85,000 tonnes this year, compared with about 100,000 tonnes last year, analysts and exporters said.

In India, total pepper output was 50,000 tonnes this year, almost steady from last year, according to Spices Board.

India and Vietnam contribute about 50 percent of the world's total output.

The July contract would get support at 14,050 rupees and face resistance at 14,525 rupees, Ratandhara said.

Spot pepper fell 0.15 percent to 14,333 rupees per 100 kg in spices hub of Kochi in Kerala.