In just the past month, domestic pepper prices have increased by 20%. Compared to the beginning of the year, prices are currently 50% higher and compared to the same period in 2023, prices have nearly doubled.
The main reason is due to the El Nino weather phenomenon causing drought in key producing countries, affecting output. On the other hand, n In recent years, pepper prices have remained low, making pepper growers not interested in this crop, leading to a decrease in acreage. Many old pepper gardens have been replaced by other crops, especially durian. Meanwhile, global pepper demand continues to recover after the COVID-19 pandemic. In particular, China is now starting to import again after a long absence, helping demand skyrocket.
Domestic pepper prices are currently at 119,000 – 120,000 VND/kg. On the world market, the price of Vietnamese black pepper type 500 g/l is currently trading at 4,800 USD/ton, type 550 g/l at 5,000 USD/ton; White pepper is at 7,200 USD/ton. Lampung black pepper (Indonesia) is currently priced at 5,121 USD/ton, Brazilian black pepper ASTA 570 is priced at 5,000 USD/ton; Kuching (Malaysia) ASTA black pepper price 4,900 USD/ton.
Muntok white pepper price is 7,426 USD/ton, up 3.33%; Malaysian ASTA white pepper price is still at 7,300 USD/ton. Pepper prices in India, Sri Lanka… are also on an increasing trend.
Output decreased
Global pepper output in the 2023/2024 crop year is estimated to decrease due to output from key producing countries. Accordingly, it is estimated that Vietnam’s pepper output in 2024 will decrease by about 10-15%. A similar situation also occurs in large-scale pepper producing countries such as Indonesia, India, Malaysia, Sri Lanka, Brazil… India’s output this year is estimated down 20%, Indonesia down 20 – 30% and Brazil down 15%.
The Vietnam Pepper and Spice Association (VPSA) estimates that this year Vietnam’s pepper output is forecast to only reach 160,000 – 1,000 tons down 10-15% compared to 2023 – the lowest level in the last 5 years, due to the shrinking area after a long period of low prices, along with the impact of El Nino.
The Vietnam Pepper and Spice Association believes that, with the current situation, global pepper production cannot meet consumer demand in the next 3-5 years.
Pepper demand recovered
Recently, Consumption demand from the US, China, and the European Union increased. This trend is expected to continue.
Malaysian Minister of Agriculture and Commodities, Datuk Seri Johari Abdul Ghani, expects global pepper demand to continue its upward trajectory in 2024 and 2025. The reason is the potential application of pepper in various fields. various products, including pharmaceuticals and cosmetics… promoting a positive increasing consumption trend.
Exports to some markets increased rapidly
According to VPSA, in the first April of the year, Vietnam exported 83,067 tons of pepper of all kinds; of which black pepper reached 73,555 tons, white pepper reached 9,512 tons. Pepper export turnover reached 352 million USD. Compared to the same period last year, export volume decreased by 19.4%, but turnover increased by 10.3%. The average export price of black pepper in 4 months reached 4,065 USD/ton, white pepper reached 5,678 USD/ton, up 19.4% for black pepper and 14.5% for white pepper respectively over the same period last year. In there, The US is Vietnam’s largest pepper export market, accounting for 27.4% and increasing by 45.2% over the same period; Exports to Asia still account for the largest proportion at 36.2%, but compared to the same period, it has decreased by 52%.
According to data from the General Department of Customs, in the first 4 months of 2024, pepper exports reached 82,970 tons, equivalent to 351.91 million USD, average price of 4,241.5 USD/ton, down 19% in volume but up 11%. % in turnover and an increase of 37.4% in price compared to the same period in 2023.
Notably, exports to some markets increased very strongly. In particular, exports to the US and Germany – the two largest markets – both increased. Exports to the US increased by 45% in volume and 60% in turnover; Sanmg Germany increased by 109% in volume and 147% in turnover. Exports to Korea, Pakistan, and Italy also increased very strongly, reaching 2 to 3 digits.
Of which, exports to the US – the number 1 export market – reached 22,766 tons, equivalent to 100.07 million USD, accounting for 27.4% of the total volume and 28.4% of the total pepper export turnover of the country. nationwide, up 45.7% in volume, up 60% in turnover compared to the same period in the first 4 months of 2023, price up 9.9%, reaching 4,395.6 USD/ton. Pepper exports to the German market ranked second in turnover, reaching 5,503 tons, equivalent to 26.23 million USD, priced at 4,767 USD/ton, an increase of 108.8% in volume, an increase of 147% in turnover and an increase in price. 18.4%; accounting for over 6.6% of the total volume and 7.5% of the country’s total pepper export turnover.
Exports to the Indian market increased by 26.3% in volume, 59% in turnover and 25.9% in price compared to the same period in the first 4 months of 2023, reaching 5,557 tons, equivalent to 22.37 million USD, price 4,026 USD/ton, accounting for 6.7% of the total volume and 6.4% of the total pepper export turnover of the country .
Given the fact that the supply of pepper will not be improved soon, the gap between supply and demand will continue, experts say that prices will continue to increase in the near future, with the expectation that pepper can return. Our country’s billion-dollar export club was relegated after 6 years.
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