2019 is a gloomy year for the pepper industry as domestic and export prices plummeted due to excess supply. This year, it is likely that pepper prices will continue to decrease but by 2021 and 2022, prices are expected to increase gradually.
Citing Vietnam Agriculture Newspaper, in 2019, the supply of pepper was abundant, exceeding demand, causing domestic and export prices to plummet. This is the 3rd consecutive year that the export value of pepper has decreased compared to the previous year. According to estimates, 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.
Pepper prices plummeted globally. In 2019, Vietnam's pepper export price averaged only US $ 2,518 / ton, down 22.9% compared to 2018.
Also according to this source, to 2020, according to some experts in pepper industry, the situation has not shown any bright signs. Mr. Hoang Phuoc Binh, Vice President 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 decreased much, many pepper gardens have been exhausted, so the overall productivity will decrease, resulting in a yield of 10-20%.
However, the consumption of goods is still very plentiful. First of all, due to the massive planting of pepper gardens in 2017, this year the harvest will begin. 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 production is expected to reach about 61,000 – 62,000 tons this year, up to 30% compared to 2019, thanks to favorable weather in Kerala state (which accounts for 55% of India's total spice production. Degrees).
But according to Mr. Hoang Phuoc Binh, the most worrying is pepper production in Brazil, due to the low price. Currently 1 ha 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, helps 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 prices 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.
According to Vietnam Agriculture Newspaper, pepper price will remain low during this crop. 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 find pepper prices low. shift to other crops and productivity decreases because a large area lacks investment and care.
Source: VITIC
