Global pepper prices are likely to increase by 6-7% next week, when the Vietnamese market is open for trade on Monday, after the traditional Lunar New Year holidays. Vietnam is the only country currently holding available goods.
Some exporters here expect prices to rise around 10% next week. According to them, Vietnam's output is lower than previously forecast.
The report proposes a total output of Vietnam could be 125,000 tons. However, the latest estimate shows that it will only be about 105,000 tons. Some people think that is even lower. Lower output, coupled with a shortage of supplies from other producing countries like India, will push prices up by 6-7%. Before entering the holidays, Vietnamese goods cost 6,050 USD / ton for 500 Gr / l, 6,300 USD / ton for 550 Gr / l and 6,700 USD / ton for Asta pepper.
Currently, Indian goods supplied to the global market are priced at 7,200-7,300 USD / ton. In addition, manufacturers such as Brazil, Indonesia and Sri Lanka are out of stock. Therefore, at present, Vietnam is the only destination for buyers. European and US buyers are expected to enter the market next week, as most of their inventory has been exhausted due to Christmas and New Year demand.
The market is getting ready for a sharp price increase around June – July as well as Vietnamese sales in the next 4-5 months. India's domestic demand can be met through local production. Therefore, global pepper supply will be scarce in June – July. Therefore, according to experts, the price increase is inevitable. So far there is no sign of production in Brazil or Indonesia.
According to the report, production in the states of Kerala and Karnataka, contributing more than 80% of India's total output, will be low. Kerala state production alone can be reduced by 50%. According to leading local traders, pepper produced in Karnataka state will be destined for domestic consumption.
Benny, a farmer from Idukki, a key pepper district of Kerala state, said that in some parts of the district, production decreased by 60%. And, the recent price increase is hardly beneficial to growers because the output is too small.
English (Follow Business Standard /Giacaphe.vn)
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