Pepper prices suddenly “danced” with a lot of disturbing information, while export outputs did not change much.
In the last days of May 2020, pepper prices in the Central Highlands and the South increased and decreased dramatically.
Specifically, on 27/5, the price of pepper jumped from 7,000 to 7,500 VND / kg, until May 28 pushed the price of pepper to 60,000 – 62,000 VND / kg. However, right after the shock increase, pepper price on 30/5 dropped sharply to 50,000 dong / kg.
On the morning of May 31, at the highest price of 56,000 VND / kg was recorded in Ba Ria – Vung Tau, the lowest was 52,000 VND / kg in Gia Lai.
Unstable pepper prices, making it difficult for exports
Mr. Nguyen Tan Hien, Vice President of Vietnam Pepper Association (VPA), Deputy General Director of Tran Chau Import Export Service Trading Joint Stock Company, said that the story of rising pepper occurred on May 27. and by the morning of May 29 has ended.
Previously, pepper price from VND 38,000 / kg inched up to VND 42,500 / kg, stopped, but then increased further to VND 48,000 – VND 49,000 / kg. At this price, the market has started to panic with rumors, many big traders in the material area have announced that “the exporter is in need, the price will be up to VND 70,000-80000 / kg, people should hold the goods and wait for the price to rise further ”.
The reason is that on May 26, Son Ha Company (in the North) raised the buying price to 53,000 – 55,000 VND / kg but bought in negligible quantities. Through May 27, pepper price jumped to VND 59,000 – VND 60,000 / kg, there are a number of traders and agents in Dong Nai, Binh Thuan and Dak Lak who buy for 60,000 – 63,000 VND / kg.
On the morning of May 29, there were still some people offering the price of 62,000 VND / kg, but for a while, the price of pepper dropped to 60,000 VND / kg, to 52,000 VND / kg in the afternoon.
On the morning of 30/5, pepper prices down the market touched 50,000 VND / kg.
In Dak Lak, pepper prices are traded at VND 51,000 – VND 52,000 / kg but only traders, dealers and people buy and sell with each other, the amount sold is very small because this price has not met the expectations of the people. The company has not bought yet as this price is higher than the export price.
“Unstable market prices not only make it difficult for businesses to buy raw materials, but also create opportunities for Brazil and Indonesia – two competitors to sell at Vietnamese prices, and Vietnamese pepper. Nam only sells roundabouts in raw material areas, not to exporters. Finally, the price of Brazil and Indonesia increased from US $ 2,100 / ton to US $ 2,500 / ton (FOB), but still lower than Vietnam's pepper prices at US $ 2,800 – 2,850 / ton (FOB). We do so to create conditions for Brazil and Indonesia to sell goods while Vietnam keeps hugging goods, ”Mr. Hien said.
Pepper prices are not sustainable
According to Mr. Nguyen Nam Hai, VPA President, General Director of Joint Stock Inspection Company for coffee and import-export goods, the situation of supply and demand in the world has not changed so the price of pepper in the world market does not increase , but recently, local prices have increased, especially in recent days.
In the past few days, domestic pepper prices have been affected by rumors of creating virtual price fever, not increasing due to demand from export markets. Thus, it can be seen that the world demand does not increase but the domestic price of pepper increases is unsustainable; and the current “price blow” is not good for exports, making businesses short of goods sources can not perform contracts with foreign partners.
Currently, in addition to signed contracts, businesses can not sign new contracts, because customers do not accept buying new prices.
The three largest export markets of Vietnamese pepper are China, the United States and India. The US market has bought enough goods until October, some businesses have bought enough to December. In the Indian market, due to the influence of Covid-19 pepper processing plants in India has decreased by 50% capacity, so demand in the Indian market is decreasing. At the current price, Chinese traders do not buy or even sell pepper back to the domestic market, because pepper prices are now higher than at the time of buying, seeing profits so they sell without carrying them. go home.
In 2014 and 2015, when pepper prices on the world market peaked (220,000 – 250,000 VND / kg) as well as Vietnam, Brazil and Indonesia increased the area of pepper growing while the demand for pepper in the world increased. Adding no more, therefore, the excess supply and demand pulled the pepper price down until now.
Vietnam has now finished the pepper harvest, pepper output in 2020 will reach about 230,000 – 240,000 tons, down about 10% compared to last year, due to some areas with low productivity when pepper prices are low, people switch to planting other crops with higher economic value. This is a negligible reduction and Vietnam is still the world's leading pepper exporter.
Source Quang Tri (bizlive.vn)
