At present, pepper export price ranges from 2,800 USD to over 2,900 USD / ton, but at this price, Vietnamese enterprises cannot sell because most of them have signed to sell at a low price of about 1,900 USD.
In the first 11 months of 2020, pepper export was estimated at 263 thousand tons, worth $ 596 million, down 1.7% in volume and 11.5% in value over the same period in 2019.
Pepper export turnover decreased sharply due to the low selling price
Average pepper export price in November 2020 is estimated at 2,543 USD / ton, an increase of 3.6% compared to October 2020 and an increase of 8.1% compared to November 2019. Generally in the first 11 months of 2020, the average export price of pepper was estimated at 2,268 USD / ton, down 10% over the same period in 2019.
Looking back at pepper export activities in 2020, Mr. Nguyen Tan Hien, Vice President of Vietnam Pepper Association (VPA), General Director of Tran Chau Import Export Trading Service Joint Stock Company said that 2020 is a year. There are too many difficulties for the pepper industry in Vietnam, of which four main factors have had a strong impact on pepper exports.
First, At the end of May, the price of pepper increased sharply so that businesses could not buy in for long-distance orders, so they suffered a lot of losses. Of course, when pepper prices go up, there will be a number of pepper exporting businesses, but most businesses encounter a sudden increase in prices, sometimes a virtual increase to suffer.
Monday, Covid-19 pandemic happened, so many ports of countries such as India, Pakistan, and Dubai … were blocked, causing a lot of backlog and delay in payment, in which Nepal with ban on pepper import has caused great damage to the export units.
Tuesday, Since July until now, freight rates have increased from 3 to 4 times, causing losses to pepper exporters, not only for the pepper industry but also for most export industries, if C&F is sold. suffer very heavy losses due to increased freight rates.
4th, The exchange rate situation between VND and USD almost does not support exports because VND seems to strengthen against USD, so exporting enterprises have to suffer.
“With the assumption that pepper export this year has difficulties, many companies accept the decrease in export volume and Pearl Company is also in that trend. We do not dare to sell far because of this forecast, and this year’s export volume of pepper is expected to decrease by more than 20%. However, there are some units that still increase the amount of this problem, depending on the judgment of each unit that has different handling.
In the first 11 months of the year, Vietnam’s pepper export decreased only 1.7% in volume but decreased by 11.7% in value, due to a very low pepper export price in the first months of 2020. At present, pepper export price ranges from 2,800 USD to more than 2,900 USD / ton, but at this price, Vietnamese businesses cannot sell because most of them have signed to sell at a low price of about 1,900 USD to 2,000 USD / ton. This is the lowest selling price compared to previous years, so the total export turnover in 11 months has decreased a lot ”, Mr. Hien shared.
Positive signals for the new export year
Before entering the new pepper crop, there are many signals that the pepper market in 2021 will be more prosperous than 2020, as pepper prices on the market are in an upward trend, most pepper businesses know and be careful before deciding to sell far.
The main markets for pepper exports are Europe, the US and China, followed by India, Nepal, Pakistan and Dubai.
Currently, most of the pepper import markets are buying in small quantities, particularly the US and European markets are heavily affected by Covid-19, so they do not buy much, but in fact, countries still use average pepper. Often, they may have a large amount of inventory so they can reduce their purchases.
However, the Chinese market recently bought very strongly, making the domestic pepper price sometimes push up to about 59,000 – 60,000 VND / kg.
In addition, there are many indications that in 2021, China’s main market imports a lot of pepper from Vietnam, the European and American markets are still normal, in 2020 the import speed of these two markets. It was slower because Covid-19 was progressing too badly.
The Indian market, heavily influenced by the Covid-19 epidemic, is buying very little because India is also a country importing pepper for re-export to Europe, but due to the impact of the Covid-19 epidemic, the European market should India’s output in the first few months has been stagnant. Recently, almost India has not bought pepper from Vietnam, and the Nepalese market has been banned. This is a large market, so it also affects Vietnam’s pepper exports.
At the end of December 2020, Dak Nong province will soon harvest a new pepper crop, and will be fully harvested at the end of January 2021. Currently, Dak Nong is the leading province in the country with the largest pepper area with more than 30,000 hectares, accounting for about 25% of the country’s area, by February 2021 Dak Lak and other provinces will catch new input.
Source Nguyen Huyen (CafeF)
