Demand for pepper in the Indian domestic market has increased sharply during the festive season Pongal and other festivals.
At this point two distinct trends in pepper trading can be seen: an increase in domestic demand, along with a drop in exports. With the Pongal festival getting closer in southern India, the demand for pepper is very good. It is known that pepper is also known as black gold. On the other hand, pepper production in Brazil, Indonesia, and Vietnam is currently increasing significantly, in return, which has a negative impact on Indian pepper exports. With Vietnam emerging as the largest pepper producer and exporter, any development related to Vietnam's production, harvest or quality of pepper is bound to influence. The global market for pepper, including India.
Nilanjan Dey, director of Wishlist Capital, said on FC Invest, “from a global perspective, importing pepper from India is much more expensive than importing pepper from Vietnam and Indonesia, the two producing countries. Other great pepper. The world market wants to import pepper from countries with cheaper prices. ”
Low export demand has led to an oversupply in the domestic market, causing a sharp decline in pepper prices, Dey said.
According to the International Pepper Community (IPC), global pepper production is expected to reach 327,000 tons in 2012 compared to 318,000 tons in 2011. Production estimates for 2013 are 317,000 tons. Indonesia's pepper output is expected to increase by 24% and Vietnam by 10%. According to initial estimates, Vietnam's pepper output in 2012 is expected to reach 100,000 tons from 110,000 tons in 2011. Brazil is also expected to produce 22,000 tons this year.
In the Indian market, pepper output in the crop year 2012/13 is expected to reach about 60,000 – 63,000 tons.
Previously, an analysis by Commodity Online Agri Services showed that India could increase production from 43,000 tons in the 2011/12 crop year to 53,000 tons in the 2013/14 crop easily, which could increase. up to 60,000 tons in the 2014/15 crop year, and peaked at 70,000 tons per year in the 2015/16 crop year, with the area secured under the replanting program.
The National Spices Council also announced plans to import Madagascar's high-yielding pepper, reaching a record production just behind Vietnam, and this pepper could increase Indian pepper production from 2,000 kg / ha. 7,000 kg / ha.
According to the latest report by Emkay Commotrade, “Pepper prices increased in the context of limited support from real goods. The spike is constrained by weaker export demand and higher volumes. Cloudy weather prevented the new pepper from being delivered to the market, where demand was good before the Pongal festival. In addition, there are currently very few goods available on the exchange. ”
Emkay Commotrade said, “Pepper prices are likely to be stable in the short term due to the slow delivery of new pepper and the continued demand for winter.”
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