Hot development, unclean production, and deadlock of output along with trade barriers set by partners are making the pepper industry face a risky year, risk of crop failure, losing position. leader of the world pepper industry.
From the beginning of January 2018, the Ministry of Industry and Trade said that pepper prices in the domestic market continued to fluctuate in a downtrend. Currently, the average price of pepper from 61,000 to 64,000 VND / kg, down 7,000-8,000 VND / kg compared to the beginning of the month and only half compared to the same period in 2017.
Pepper prices have dropped sharply in the past two years due to a sharp increase in acreage. According to the Department of Crop Production, Ministry of Agriculture and Rural Development, in 2010, the whole country planted only 51.5 thousand hectares of pepper; in 2014 increased to 85,591 thousand hectares; By the end of 2017, it will be 152,668 hectares, an increase of 196.3% compared to 2010, an increase of 22.5% compared to 2016, exceeding the plan by over 100,000 hectares.
Price plunged, many barriers
Regarding export (export), according to the General Department of Customs, in the first 15 days of January 2018, the amount of export pepper reached 6,654 tons, valued at US $ 28.16 million, up 71% in volume and up 0.3 % in value compared to the same period last year. The average export price of pepper in the period stood at 4,232 USD / ton, down 41.3% compared to the average export price of the same period in 2017.
According to estimates, in January 2018, the export volume of pepper reached 12 thousand tons, worth US $ 51 million, up 43.5% in volume, but down 17.5% in value compared to January 2017. The average export price of pepper in January 2018 was US $ 4,250 / ton, down 42.5% from the average export price of January 2017.
Earlier, in 2017, the export volume of pepper reached 214,855 tons, worth US $ 1.12 billion, up 20.9% in volume but down 21.8% in value compared to 2016. In particular, the United States is the market Vietnam's largest pepper export market in 2017 with the amount of 38,861 tons, valued at US $ 221.2 million, down 1.9% in volume and 35.4% in value compared to 2016.
European Union (EU), Vietnam's second largest export market of pepper, in 2017 imported from Vietnam 25,739 tonnes worth US $ 156.5 million, down 0.3% in volume and 39.9% in weight. % in value compared to 2016.
The volume of pepper exported to India in 2017 reached 16,262 tons, worth US $ 78.8 million, up 46.3% in volume, but down 6.4% in value compared to 2016.
The Ministry of Industry and Trade predicts that in 2018, pepper exports will continue to face many difficulties when the supply is exceeding demand. The rapidly increasing pepper area in Vietnam and some other countries has led to a sharp increase in global output. World pepper production in 2016 reached 434,000 tons, by 2017 increased to 510,000 tons.
Pepper productivity in 2018 also decreased sharply due to prolonged rains in 2017, leading to the inability to cut water, flower size for pepper and make many pepper gardens vulnerable to pests. In Ba Ria – Vung Tau province, the pepper output only reaches 60-70%.
According to the Vietnam Pepper Association, in 2018, pepper productivity in some major producing countries, including Vietnam, may decrease but due to the increase in acreage for harvesting, the total global supply will still be Higher than 2017 and higher than demand. This makes world prices tend not to increase.
In addition, Vietnam's pepper exports will be difficult due to technical barriers from importing countries such as the United States, the EU … The US Food and Drug Administration (FDA) is planning to consider raising the gender level. maximum allowable MRLs of some active ingredients including Arcrimnathril, Tricyclazole, Metalaxyl … for Vietnam pepper imported into the United States.
Similarly, at the end of 2016, the European Commission (EC) planned to raise the Metalaxyl MRLs for imported pepper from 0.1ppm to 0.05ppm. However, before the objections of Vietnam and India, the EC has maintained the Metalaxyl MRLs at 0.1ppm until the end of 2018. Therefore, if there is no good quality control, Vietnam will gradually lose market share in EU as well as in USA, India.
Recently, to protect the production of domestic pepper farmers, India has applied a minimum tax on import pepper. Previously, a ton of Vietnam's pepper exported to India was priced at 5,000 USD, now increased to 8,000 USD / ton. This directly affects the competitiveness of Vietnamese pepper
What to do to decide the price?
Thus, 2018 is a year when Vietnam's pepper industry has to compete very fiercely, so to compete successfully, it must have advantages. However, frankly, the industry still has many shortcomings due to overheating.
According to the MARD master plan by 2020, the total area of pepper nationwide is only about 50,000 hectares but by 2017, the actual area of pepper nationwide is estimated at 120-130 thousand hectares.
Regarding pepper prices, many countries are now importing pepper from South American countries because of the cheaper price of VND 2,000-3,000 / kg. According to Nguyen Nam Hai, President of the Vietnam Pepper Association, Brazil's pepper prices are very cheap, so many customers are focusing on buying Brazilian pepper. It also means that Vietnamese pepper is having difficulty in North American markets.
Besides, the technical process is not guaranteed, farmers grow anywhere without knowing whether the soil is appropriate or not. In particular, the abuse of chemical pesticides is very common. Although it is assessed as a billion-dollar export industry, there is no standard seed, not focusing on processing and branding.
Under this situation, the Ministry of Agriculture and Rural Development believes that the first thing to do is to restructure the industry towards clean production, limit the abuse of pesticides and chemicals, which is necessary for the sustainable development of the commodity industry. pepper in the future.
For the state management, MARD requires the Ministry's steering units to focus on seed work soon, closely managing operations, research with the needs of enterprises and markets.
Strengthen the management of agricultural materials such as fertilizers and pesticides, encourage the conversion to use organic fertilizer, and soon review each sub-region to assess the technical process. In addition, it is necessary to research on breeding and quality control of pepper varieties.
Mr. Le Quoc Doanh, Deputy Minister of Agriculture and Rural Development, emphasized how the association and the local authorities must “handle” the market, proactively set a price on the pepper industry in the international market.
“We are in the position of leader of the world pepper industry but we have not yet shown this position. Therefore, from 2018, the Ministry of Agriculture and Rural Development will attach special importance to the formulation of strategies to improve the position of the pepper industry, ”Mr. Doanh affirmed.
Mr. Nguyen Nam Hai – President of Vietnam Pepper Association
In fact, many businesses have brought the final product of pepper to supermarkets and restaurants, but domestic consumption is unlikely to increase sharply due to the underdeveloped domestic food industry. Therefore, there is only one way to develop towards sustainable production. Here, pepper farmers need the combination and indispensable support of export enterprises.
Mr. Nguyen Xuan Cuong – Minister of Agriculture and Rural Development
The pepper industry is growing too fast, resulting in limited restructuring. If no action is taken soon, the risk of falling behind is obvious, the pepper industry agrees not to increase but to reduce the area, because production is effective, not productivity. It is suggested that localities, together with agricultural extension agencies, have to firmly propagate for people to change their awareness, should not plant if it is not suitable, if the pepper is dead, do not replant, give the area to other crops. higher efficiency.
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