Shortage of supply, pepper prices increase sharply

Pepper export in 5 months, strong increase in value Pepper price increases strongly, positive export

Survey shows that pepper prices in the domestic market in the Central Highlands have stagnated, ranging from 83,000 - 85,500 VND/kg, unchanged from yesterday. Specifically, Chu Se pepper price (Gia Lai) continues to be purchased at 83,000 VND/kg. Dak Lak pepper price and Dak Nong pepper price are purchased at 85,500 VND/kg.

In the Southeast region, pepper prices ranged from 85,000 - 86,000 VND/kg. Of which, pepper prices in Ba Ria - Vung Tau were at 85,000 VND/kg; pepper prices in Binh Phuoc stagnated at 86,000 VND/kg. This level increased by 2,500 - 3,000 VND compared to the previous day.

According to forecasts, in the coming time, pepper prices may increase further due to supply shortage.

In the world, the pepper market is in a high price phase. For Indonesian pepper, a ton of Lampung black pepper remains at 3,906 USD, Muntok white pepper is 6,159 USD. The price of Brazilian black pepper ASTA 570 continues to remain at 3,000 USD/ton.

For Malaysian pepper, the price of a ton of Kuching ASTA black pepper remained stable at USD 4,900 and ASTA white pepper at USD 7,300. This price is also higher than Vietnam's export goods.

Meanwhile, the export price of Vietnamese black pepper 500 g/l today is trading at 3,900 USD/ton, with 550 g/l trading at 4,000 USD/ton, and ASTA white pepper trading at 5,700 USD/ton.

According to the Vietnam Pepper and Spice Association (VPSA), pepper prices have increased sharply due to high demand, increased orders while inventories have decreased. The new crop is in the harvest season, but Vietnam's pepper output this year may decrease by about 10-15% to 160,000-165,000 tons.

Businesses believe that pepper prices could reach VND95,000-100,000 per kilogram and return to the golden age of coffee when the impact of El Nino reduces the productivity of agricultural products. However, pepper prices will be difficult to increase in the long term when the upcoming consumption demand of countries around the world may decrease due to the impact of the economic crisis caused by geopolitical conflicts in some regions.

VPSA forecasts that by 2025, the export turnover of the entire pepper and spice industry will reach around 2 billion USD, with a total output of 400,000-500,000 tons.

The Import-Export Department (Ministry of Industry and Trade) said that Vietnam's pepper exports in January 2024 are estimated to reach 20,000 tons, worth 79 million USD, down 1.4% in volume, but up 1.9% in value compared to December 2023; compared to January 2023, it increased by 60.2% in volume and 83.9% in value.

Vietnam's average pepper export price in January 2024 is estimated at 3,953 USD/ton, up 3.4% compared to December 2023 and up 14.8% compared to January 2023.

In terms of export type structure, in 2023, Vietnam mainly exported black pepper, accounting for 69.51% of the total volume and 70.67% of the total pepper export turnover of the country in 2023. Therefore, the growth of black pepper exports has had a positive impact on the whole industry.

The Vietnam Pepper and Spice Association (VPSA) forecasts that Vietnam's pepper output in 2024 will decrease by about 10 - 15% to 160,000 - 165,000 tons.

Meanwhile, in the first quarter of 2024, purchases from Western countries may increase again to replenish inventories, while pepper reserves in the market may be depleted. These factors are expected to push up world pepper prices in general and Vietnamese pepper prices significantly, possibly reaching VND100,000/kg this year.

According to data from the Ministry of Agriculture and Rural Development, the pepper growing area in Vietnam in 2023 will reach 115 thousand hectares, a decrease of 5 thousand hectares compared to 2022; Output in 2023 will reach 190 thousand tons, an increase of 3.8% compared to 2022.

The 2024 pepper harvest has begun in some districts of Dak Nong province, however, the harvest is scattered in some districts and is not much.

Due to the impact of climate change, the 2024 harvest will be later than in 2023. Vietnam's pepper output in 2024 is expected to reach only 170 thousand tons, down 10.5% compared to 2023. Pepper prices in the domestic market have increased due to limited supply.

Source