The Malaysian domestic pepper market is recovering strongly after prices fell to the lowest level of the year at the end of July.
In Kuching market, the price of KG1 white pepper was at RM 26,350 / ton on July 21, up more than 11%, from VND 23,600 / ton about seven weeks ago. While the price of black pepper from RM 14,650 / ton increased by nearly 17% to RM 17,100 / ton over the same period.
Only in the last 4 trading days, from 18 to 21 September, the price of black pepper increased to 1,420 RM / ton, equivalent to an increase of 9.06%, while the price of white pepper was almost unchanged.
Around April 3-4, the price of Malaysian domestic pepper increased to a record high of this year when white pepper reached RM 27,000 / ton and black pepper reached RM 17,800 / ton.
Grunsin Ayom, head of the Malaysian Pepper Commission (MPB), said an unreasonable price recovery had occurred as Indonesian farmers tightened supplies. Previously, farmers of this country had to sell pepper to get cash to spend on the recent Islamic festival.
Indonesia is the world's third largest pepper producing country after Vietnam and India.
Mr. Grunsin also told StarBiz-Week Newspaper, “Malaysian pepper farmers are holding back goods waiting for higher prices. They are not in a hurry to sell. ”
Lo Kun Seng, managing director of LHC-SK Sdn Bhd, Malaysia's leading pepper exporter, said: “Currently the supply of pepper in Malaysia is tight and prices have been pushed up in when dealers and exporters are trying to buy because their stock is out of stock. ”
“We have hardly had any supplies in the past month because there are very few sellers on the market even though farmers have almost completed the harvest,” Lo added.
Most Malaysian pepper exporters have signed sales contracts with foreign spice traders and consumers.
Lo also said that Vietnamese farmers, the country that produces and supplies about one-third of the world's pepper demand, are also holding back when they expect prices to rise sharply.
Since the 2010/11 crop year, domestic prices of Malaysia have increased by around 9,500 RM / ton for white pepper and by 6,250 RM / ton for black pepper.
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