Consumption prices rose sharply in March 2021, although demand was less volatile, the market is expected to cool down gradually in the second quarter when supplies from the new harvest are put into consumption.
From the beginning of March up to now, the pepper market in the country has had strong fluctuations in price. From March 1 to March 19, domestic pepper prices increased by 42 – 44% (equivalent to 22,000 – 24,000 VND / kg), from 53,500 to 55,500 VND / kg to 76,000 – 79,000 VND / kg. .
After that, pepper prices decreased and fluctuated in a narrow band since March 26 up to now.
Accordingly, as of February 2, pepper prices in many provinces and cities fluctuated at 70,000 – 74,500 VND / kg, down 4,000 – 6,000 VND / kg compared to March 19, but still higher than 17,000 – 20,000 VND. / kg compared with the beginning of January this year and doubled over the same period in 2021.
Specifically, pepper price in Ba Ria – Vung Tau province is at the highest level with 74,500 VND / kg; followed by Binh Phuoc with 73,500 VND / kg; in Dak Lak and Dak Nong provinces, pepper was purchased for 73,000 VND / kg; pepper prices in Dong Nai and Gia Lai were at 70,000 VND / kg.
Source: tintaynguyen.com. Chart: Ngoc Bao
On the world market, export prices of black pepper in major producing countries also increased significantly in March and are at the highest level in recent years.
Specifically, in Brazil, on 31/3, the price of black pepper for export increased strongly by 1,200 USD / ton, equivalent to an increase of 42.9% compared to the beginning of March to 4,000 USD / ton.
In India, the price of black pepper at the port of Kochi increased 430 USD / ton (up 8.8%) compared to the beginning of March to 5,342 USD / ton. In Indonesia, export price of black pepper also increased by 730 USD / ton (up 25.7%) to 3,570 USD / ton.
At the Malaysian port of Kuching, the export price of black pepper increased by 375 USD / ton (up 9.7%), reaching 4,225 USD / ton.
Source: ipcnet.org. Chart: Ngoc Bao
At ports in Ho Chi Minh City of Vietnam, the price of black pepper also increased by 400 – 440 USD / ton (equivalent to an increase of 12.3 – 13.9%) compared to the beginning of March, to 3,595 – 3,635 USD / ton. …. International prices of white pepper also increased by 6% – 11% in March.
Contrast forecasts about the supply
Some information said that the sharp increase in pepper prices recently was due to the high world demand and the decline in global pepper production, including Vietnam.
However, the pepper harvest in the country is expected to end at the end of April, but so far there are conflicting opinions on pepper production.
The Vietnam Pepper Association (VPA) believes that pepper output in 2021 may decrease by 25-30% compared to 2020.
However, according to recent data from the General Statistics Office, pepper output harvested in the first quarter of 2021 reached 200,000 tons, down only 0.5% compared to the same period in 2020.
Meanwhile, Vietnam’s pepper export in the first quarter of 2021 reached 60,000 tons, worth $ 174 million, down 25% in volume and 1.4% in value over the same period in 2020.
Despite the decrease in volume, pepper is the commodity with the strongest increase in export prices among agricultural exports, up 31.5% compared to the first quarter of 2020, reaching an average of 2,879 USD / ton.
Facing the unusual movement of the pepper market, in mid-March, the Vietnam Pepper Association (VPA) made a recommendation despite the pepper production in Vietnam and other countries around the world. is predicted to decrease as a result of change kGoodness, but the decrease is not commensurate with the rate of price increase.
Overall supply is still higher than demand. The world’s current demand for pepper is about 500,000 tons, while the supply in 2021 plus inventories of the previous years is about 600,000 tons.
Therefore, the rapid increase in prices in the country is due to speculation. This poses risks for both farmers and businesses pepper export because of fluctuations.
From the above data, it can be seen that the recent rise in pepper prices is not really sustainable, potentially risky.
Especially during the time when Vietnam and other pepper producing countries are in harvest. Therefore, pepper business units should be cautious about this development.
Although demand from the pepper market is improving positively after the COVID-19 pandemic, with supply forecast to continue to exceed demand in 2021 and pepper from Vietnam’s new harvest. In the future, pepper prices are expected to cool down again in the second quarter of 2021.
Source: GSO. Chart: Ngoc Bao
According to the Government NewspaperWorld demand is currently at 510,000 tons of pepper / year and an average annual increase of only 2-3%, while global pepper output increases by 8-10%.
Global pepper production will reach more than 660,000 tons by 2020, is forecast to increase to 1 million tons by 2050, and world demand for pepper also increases, but not in balance with the supply.
Therefore, VPA also recommends that pepper prices may remain volatile for many more years.
Talking to the writer, Mr. Nguyen Tan Hien, VPA Vice Chairman said that in general supply is still higher than demand. The world’s current demand for pepper is about 500,000 tons, while the supply in 2021 plus inventories of the previous years is about 600,000 tons.
Orders like every year, sometimes even less than last year because some customers still have inventory.
According to VietnamBiz
