This year, pepper prices will likely continue to decline due to the abundant supply
| Pepper prices are likely to continue to fall this year |
2019 is a bleak year for the pepper industry as domestic and export prices plummeted due to excess supply. According to the Ministry of Industry and Trade, it is estimated that in 2019, Vietnam exported 287 thousand tons of pepper, worth US $ 722 million, up to 23.4% in volume but down 4.8% in value compared to 2018.
Thus, in 2019, pepper exports continue to reach a new record of volume, but the value continues to decline. And this is the 3rd consecutive year that the export value of pepper has decreased compared to the previous year.
The export value of pepper decreased, due to the continued sharp decline in global prices. In 2019, Vietnam's export price of pepper reached an average of US $ 2,518 / ton, down 22.9% compared to 2018.
Entering 2020, according to some experts in pepper industry, the situation has not shown any bright signs. Mr. Hoang Phuoc Binh, PCT of Chu Se Pepper Association (Gia Lai), said that due to the low price of pepper in recent years, many households no longer invest and take care of pepper gardens as before. Therefore, although the area of pepper has not been reduced much, many pepper gardens have been exhausted, so the overall yield will decrease, leading to a 10-20% reduction in output.
However, the consumption of goods is still very plentiful. First of all, because the pepper gardens were massively planted in 2017, this year will start to harvest. Besides, there is still a significant amount of pepper from the previous crop, which still exists in many households, establishments, businesses, due to hoarding goods and speculation to wait for prices to rise.
Meanwhile, pepper output is likely to continue to increase in some major producing countries. As in India, pepper output this year is expected to reach about 61,000-62,000 tons, up to 30% compared to 2019, thanks to favorable weather in Kerala state (where accounting for 55% of total Indian spice production. Degrees).
But according to Mr. Hoang Phuoc Binh, the most worrying is the production of pepper in Brazil, due to very low prices. Currently 1 hectare of pepper land in Brazil is only about 500 USD. Because of the large land, each pepper garden in Brazil is only planted on ¾ area / crop, ¼ is left to not allow the soil to recover. Every turn in order not to each quarter of such area through each crop, so the soil in Brazil always ensures fertility, helping pepper grow well, give high yields at low costs …
With the sharp increase in pepper acreage in many countries in the years 2016-2017, it is forecast that global pepper production will maintain the momentum until at least the end of 2020. With domestic and global factors. As mentioned above, many pepper industry experts believe that this year, pepper prices are likely to continue to fall.
By this time, the pepper industry has entered a new season, when many pepper gardens in Dak Nong conduct harvesting. In the early days of January, pepper prices were stable at VND 39,000-42,000 / kg.
Because supply still exceeds demand, it is likely that in this crop, pepper price will continue to decline, at around VND 36,000-38,000 / kg. There may even be times down to 35,000 VND / kg.
However, Mr. Binh said that pepper prices will not fall deeper than the above level, because when the pepper price is only around 37,000 VND / kg, surely many speculators will buy into it, thereby, keep the price. pepper does not go lower.
Pepper prices will remain low throughout the season. It is forecasted that by 2021, pepper prices may have increased slightly and have started to increase since 2022, when pepper production has decreased in Vietnam as well as globally because many farmers see low prices. switch to other crops and productivity decreases because a large area lacks investment and care.
According to NNVN
