Pepper prices are rising sharply, but farmers should not rush to expand their pepper acreage. It is recommended from the Vietnam Pepper Association.
Farmers should not expand the acreage of pepper despite the high prices. Photo: Tran Trung
Facing strong fluctuations in pepper prices in the domestic pepper market in recent years, the Vietnam Pepper Association (VPA) has just held an extraordinary meeting of the Executive Committee, comprising the Association’s leaders and more representatives. 30 domestic pepper export enterprises and FDI enterprises, to find out the reasons as well as listen to the opinions of businesses in assessing the current pepper market.
From comments and comments, VPA has gathered some basic contents related to the current pepper situation. First of all, the amount of pepper exported in the first 2 months of 2021 decreased sharply compared to the same period in 2020: Specifically, according to the General Department of Vietnam Customs, pepper exports in the first 2 months of 2021 nationwide reached 30,291 tons with a turnover of 87.56 million USD. Compared to the same period in 2020, exports decreased by 25.3%, turnover decreased by 6.5% (February is the month coinciding with the Lunar New Year holiday, coinciding with a time of shortage of containers and high transportation costs). .
The pepper harvest season in 2021 is later than the previous year due to the impact of climate change. Up to now, the whole country has harvested about 30-40% on average. By the end of April 2021, the harvest has basically been completed, so the output has not been much.
During the period of time, the price of pepper in the country increased highly while the export price has not increased correspondingly. In the first half of March, on raw material areas, domestic pepper prices continuously increased from VND 56,000 / kg on 3/3/2021 to VND 70,000 / kg on March 11, 2021 (March 13, prices pepper has increased to over 70,000 VND / kg in some localities). VPA believes that the current hot rise in pepper prices, apart from objective factors, is also influenced by domestic speculators.
Meanwhile, due to the Covid-19 epidemic there is a global downward trend, combined with the decrease in output in pepper producing countries due to the effects of climate change, the demand for pepper consumption and processing on markets in the Americas, Asia, Europe, and India tend to increase. However, the increase is not high, not commensurate with the current raw material prices. Market the highest buyers are also at 3,000 USD / ton of 500 g / l, but very few buyers.
Due to high domestic pepper prices, some Vietnamese exporters bought Brazilian goods directly from Brazilian exporters or from Dubai traders because Brazilian pepper prices are quite cheap compared to Vietnam.
Facing fluctuations in pepper prices, VPA warned exporters not to sign long-distance contracts to avoid risks. For signed contracts, purchase progress should be regulated because pepper has not yet been harvested well. It is up to each business to propose and deal with the customer: Negotiate with the customer on the delivery time or request to buy another alternative market, or negotiate to compensate for the contract.
VPA believes that farmers and pepper buying agents need to consider selling at the right time, not picking green pepper at harvest, not because of the price increase, but borrowing from banks or other sources of loans to store goods. , avoid the risk when the market price falls. In particular, despite the rising prices, farmers need to limit the expansion of pepper growing acreage as in 2015-2016.
VPA suggested businesses need to access the market, invest heavily in deep processing to increase export products, the number of exports and export turnover in the coming months when the harvest is booming.
According to NNVN
