World pepper prices last week dropped sharply due to sell-off activities, when Malaysia and Indonesia entered the harvest season.
Spot pepper on the Kochi market (India) fell to Rs 36,500 per 100 kg from Rs 37,913 a week ago. India’s pepper exports also fell to $7,125 per tonne, from Rs 7,400. Vietnam’s export pepper price is stable at 6,800-6,900 USD/ton. There is no Lampong pepper offered for sale in the export market. The Indonesian market is expected to be active from July, when the new pepper crop is available in the market. US customers bid 3.18-3.20 USD/lb.
Malaysian pepper is sporadically present in the world market, with an expected output of 12,000-15,000 tons. Pepper from Indonesia is also expected to hit the market in July, and this year’s black pepper production is expected to reach 22,000 tonnes. Traders think that both countries will sell the old pepper at a discount before the new crop hits the market.
Demand is not high at this time, and buyers are not hoarding much.
Vietnam’s pepper exports in the first three months of 2012 were very active despite a decrease in US imports. In 3 months, Vietnam exported 31,063 tons of pepper, up 23% over the same period last year. Germany and the US decreased pepper imports compared to last year, but exports to Arab countries increased sharply.
There are many predictions about Vietnam’s pepper production. The President of the World Spice Organization (WSO), Philip Kuruvilla, is estimated to reach 140,000 tonnes. According to him, “The market is very quiet and India is selling at higher prices than other origins. The supply in the Vietnamese market is quite large and we need to reduce prices to export.”
According to the International Pepper Organization (IPC), Vietnam’s pepper output this year will reach 135,000-140,000 tons, higher than the 100,000-110,000 tons previously forecast.
India imported nearly 1,000 tons of pepper in March. Traders said exports from India fell, domestic demand also fell due to the hot weather in the north of the country.
IPC forecasts global pepper production in 2012 will increase by 7.2% thanks to increased production in Vietnam and Indonesia. Production this year will reach 320,000 tons, compared with 298,000 tons in 2011. Global pepper exports will increase to 246,000 tons, from 242,000 tons in 2011.
Indonesia’s pepper production is forecast to increase to 41,000 tons, from 33,000 tons last year, while Malaysia’s will increase to 26,500 tons from 25,600 tons.
Indian pepper production is forecast to decrease by 5,000 tons to 43,000 tons due to bad weather, reduced planting area and reduced yield. Therefore, any increase in exports could support prices in the medium to long term.
The Spices Board of India reported that exports for the period April 2011 to January 2012 increased by 49 per cent to 22,300 tonnes, from 14,950 tonnes in the same season in 2010-11.
Pepper imports into the US in the April-November period increased by 1.58% to 64,276 tons, compared with 63,274 tons in the same period of 2010-2011.
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