1. By K Sridhar Pulkit

2. HISTORY  Originated in Latin America ( wild crop)  New Mexico  Guatemala  7500BC  Domesticated in 5000BC  1 st ever domesticated crop in America  Cultivated with primary crop to protect damages from birds

3. HISTORY (cont…)  Columbus brought seeds back to Europe in 1493  Came to Asia in 16 th century  Asian climate suited for the crop and production shifted to Asia  Cultivation  Simpler to cultivate on different soil types with several climatic conditions

4. INDIA  Produces through out the year  2 crops  Dry season from March to July  Wet season from August to December  Green chilly  Red Chilly  80% red and Dry

5. PRODUCTION  Countries  India 47%  China 9%  Peru 6%  Thailand6%  Pakistan 5%  Bangladesh 4%  Ethiopia 4%

6. Source:- compiled from FAOSTAT data

7. Production of Chilli in India Source :- compiled from NCDEX data

8. year APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR CHILLIESCHILLIES 2005-0622.0524.0023.3822.2017.7519.4022.7529.0028.5026.5027.2532.00 2006-0736.6741.7545.2546.0049.6358.50 57.0057.2057.5044.1341.63 2007-0844.1738.0045.4242.88 43.1342.3838.6334.8835.5037.8841.50 2008-0934.50 43.0045.7549.0048.2554.0054.3353.4050.3047.5049.13 2009-1045.2542.0049.8349.3054.3853.8855.6059.5056.2553.8045.6943.38 2010-1155.5044.0048.0045.0044.6344.8043.70 Source :- compiled from spices board of India data Historical Prices of chilli

9. Market influencing factors  Seasonal price fluctuations  Over all production in the INDIA  World Demand  Stock available in cold storages  Heading among the various verities of chili

10. CHILLI / Paprika yearMT 2005680 2006933 20071,595 2008475 2009820 IMPORTS

11. Type of contractFutures Contract Specifications Name of commodityChilli Ticker symbolCHLL334GTR Trading systemNCDEX Trading System Basis Chilli (Paala) traded as LCA 334 ex warehouse Guntur inclusive of all taxes and Market Cess Unit of trading5 MT Delivery unit5 MT Quotation/ Base valueRs. per Quintal Futures Contract Specifications. (Contract specifications applicable for Chilli)

12. Tick sizeRe. 1 Quality specification LCA 334 Colour - Bright Red Length a) Not less than 5 cms b) Chillies less than 5 cms will be allowed to a maximum of 5% by weight Moisture should not be more than 12.5% Foreign matter should not be more than 2% Broken Chillies should not be more than 7% Loose seeds should not be more than 2% Damaged and discolored pods - Basis 6% Acceptable up to 7% with 1:1 discount Pods without stalks should not be more than 8%

13. Delivery center Guntur (up to the radius of 50 Kms from the municipal limits) Hours of Trading As per directions of the Forward Markets Commission from time to time, currently: Mondays through Fridays: 10:00 a. m. to 5:00 p.m. Saturdays: 10.00 a.m. to 2.00 p.m. The Exchange may vary the above timing with due notice. Due date/Expiry date 20th day of the delivery month If 20th happens to be a holiday, a Saturday or a Sunday then the due date shall be the immediately preceding trading day (other than a Saturday) of the Exchange Opening of contracts Trading in any contract month will open on the 10th day of the month. If 10th happens to be a non-trading day, contracts would open on the next trading day

14. Daily price fluctuation limit Daily price limit will be 2%. If the price touches 2%, trading will continue with 2% limit for the 15 minutes period from the time 2% limit was reached. Thereafter, price limit would be extended by another (+)/ (-) 2%. No trade would be permitted during the day beyond the price limit of (+)/(-)4% from the previous day's closing price Position limits Member: Maximum of 4,500 MT for all contracts or 15% of market open position whichever is higher. Client: Maximum of 1,500 MT for all contracts Member: Maximum of 1,500 MT or 15% of market wide open interest in near month whichever is higher Client: Maximum of 500 MT

15. Supply Chain & Market structure

16. Cold storage Moisture < 11% Stored in Gunny Bags Loss color Retain color Maintained at 8deg Chilli fruits, after harvest, are spread for sun drying to reduce the moisture content elow 11% and then they are stored in gunny bags for marketing. During the period of storing, chilli will loss its color, oleoresins content and pungency. Chilli stored in cold storage will retain its color, oleoresins content and pungency, and thereby fetches good prices. Optimum temperature in cold storage should be 8°C and normal room temperature. In this condition, self-life can extend up to 2-3 year whereas in ambient condition only for 2-3 months.

17. Monday, November 08, 2010 2:39 N Commodity Today Delivery Center Expiry DateBest BuyBest SellLTP Chilli Guntur 19-Nov- 10 5085.00 5092.00 5091.00 Chilli Guntur 20-Dec- 10 5074.00 5109.00 5085.00 Chilli Guntur 18-Feb- 11 5025.00 5056.00 5047.00 Change (%) ChangeHighLow Open Interest Contract Since Inception -132-2.53521350262335 -111-2.14520050211590 -53-1.04511149981000 Prices on NCDEX as on 8 th November 2010