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1. In a 4- or 5-quart Dutch oven combine apples, the coarsely chopped green pepper, jalapeno peppers, vinegar, sugar, and water. Bring to boiling; reduce heat. Boil gently, uncovered, for 10 minutes. Strain mixture through a sieve, pressing with the back of a spoon to remove all liquid (should have 4 cups). Discard pulp.
2. Return liquid to Dutch oven; bring to boiling. Add pectin; return to boiling. Boil hard for 1 minute, stirring constantly. Remove from heat. Stir in the finely chopped green and red sweet peppers and the banana pepper. Pour into hot, sterilized half-pint canning jars, leaving a 1/4-inch head space. Wipe rims; adjust lids. Process in boiling-water bath for 5 minutes (start timing after water boils). Remove from water bath; cool on wire rack until set (jelly will take 2 to 3 days to set). Store jars in a cool, dark place up to 3 months. Makes about 5 half-pints (70, 1-tablespoon servings).