| It is expected that by the end of August 2023, Vietnam can export all of its pepper output in 2023. In the first 7 months of 2023, pepper exports to China increased by 665% compared to the same period in 2022. |
The Import-Export Department (Ministry of Industry and Trade) cited data from the General Department of Customs, saying that it is estimated that Vietnam's pepper exports in August 2023 reached 16 thousand tons, worth 60 million USD, up 4.9% in volume and 5.4% in value compared to July 2023, and down 13.4% in volume and 20.2% in value compared to August 2022.
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| Vietnam's pepper exports are forecast to remain low. |
In the first 8 months of 2023, Vietnam exported about 184 thousand tons of pepper, worth 600 million USD, up 14.5% in volume, but down 15.9% in value compared to the same period last year.
In August 2023, the average export price of Vietnam's pepper is estimated at 3,748 USD/ton, up 0.5% compared to July 2023, but down 7.9% compared to August 2022. In the first 8 months of 2023, the average export price of Vietnam's pepper is estimated at 3,263 USD/ton, down 26.5% over the same period last year.
In terms of type structure, in July 2023, Vietnam's exports of black pepper and ground black pepper decreased in both volume and value compared to July 2022, while exports of white pepper and ground white pepper decreased in volume but increased in value.
In the first 7 months of 2023, black pepper exports increased in volume but decreased in value compared to the same period last year; ground black pepper, white pepper and ground white pepper decreased in both volume and value.
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Developments in Vietnam's black pepper and white pepper export prices from the beginning of 2023 to present (Unit: USD/ton) (Source: International Pepper Community (IPC)) |
It is forecasted that in the short term, the global pepper market will be under pressure from weak demand from the United States, Europe and China. However, limited supply from Vietnam will have a positive impact on global pepper prices.
According to the International Pepper Community (IPC), total global pepper output in 2023 is estimated at 526 thousand tons, lower than 537.6 thousand tons in 2022. Of which, Vietnam's pepper output is estimated at 200,000 tons, up 9.3%; output in Brazil, Indonesia and India is forecast to decrease compared to 2022.
Currently, the amount of pepper from the 2023 crop is not much left in the hands of people and businesses. From now until the end of the year, pepper exports will mainly come from inventories from previous years. This is believed to be the reason for the increase in domestic pepper prices in August 2023.
Specifically, on August 28, 2023, the price of black pepper increased from 1,500 - 2,000 VND/kg compared to the end of July 2023, to 68,500 - 72,000 VND/kg (depending on the surveyed area). The price of white pepper was at 102,000 VND/kg, an increase of 1,000 VND/kg compared to the end of July 2023, but still lower than the level of 105,000 VND/kg in the same period last year.
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Price developments of black pepper in the domestic market from the beginning of 2022 to present (Source: Vietnam Pepper Association) |
Updated as of September 7, provinces are purchasing pepper at prices ranging from 70,500 - 73,000 VND/kg. Of which, Gia Lai is the locality with the lowest purchasing price of 70,500 VND/kg. Meanwhile, Ba Ria - Vung Tau province continues to maintain the purchasing price at 73,500 VND/kg.
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| Domestic pepper price on September 7, 2023 |
It is forecasted that Vietnam's pepper exports will remain low in the coming time. Domestic supply is no longer abundant, and demand from the US, EU and Chinese markets has not really improved.
From a business perspective, speaking with a reporter from the Industry and Trade Newspaper, Ms. Nguyen Thi Huyen - General Director of Cinnamon and Star Anise Production and Export Joint Stock Company (Vinasamex) - said that due to the impact of the pandemic, inflation has caused a decrease in demand for many types of agricultural, forestry and fishery products in markets such as the EU and the United States.
However, although the demand for Vietnamese spice products in general and pepper in particular has decreased slightly, businesses have not been much affected.
The reason is that Vietnam's product groups usually not only serve the spice industry group but they also use it for many different purposes.
For example, cinnamon, star anise, pepper, ginger and turmeric products are used by customers in the food and beverage industries such as wine, tea and herbs.
In addition, these products are also sold to units specializing in making medicines, functional foods, and beauty care products for women. These are two product groups that are considered to have a strong growth trend after the Covid-19 pandemic.
Vietnam has strengths in the agricultural sector and especially Vietnamese spices due to climate and soil conditions have created aromas and flavors in pepper, cinnamon, and star anise that are different from other markets in the world.
“Cinnamon contains procyanidins and cinnamic acid , which are two ingredients used to make anti-stroke and anti-inflammatory drugs. Star anise also contains certain amounts of shikimic acid, which helps star anise have strong antiviral effects. Shikimic acid is also known as the main ingredient in Tamiflu, a drug used to treat colds. As for pepper products, pepper is indispensable on dining tables around the world,” said Ms. Nguyen Thi Huyen.
Regarding the EU market, according to Ms. Nguyen Thi Huyen, Vietnam currently has the EVFTA Agreement and pepper and spice exporting enterprises are benefiting greatly from this Agreement.
“Many EU customers have switched from buying from Indonesia, China, etc. to buying from Vietnam to take advantage of the 0% import tax,” said Ms. Nguyen Thi Huyen.
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