Ministry of Industry and Trade: Vietnam pepper market will benefit in price because of scarce supply
Aug
According to the Import-Export Department ( Ministry of Industry and Trade), the global pepper supply is supplemented when Indonesia enters the harvest season, starting in July. However, Brazil, the second largest black pepper producing country in the world, world, is facing continuous crop failures due to drought.
According to some farmers in the Espirito Santos region (Brazil), the harvest in 2024 may be 25-30% lower due to the heat causing most of the first cotton to fall and the ratio of fruit set to cotton to decrease. Phase 2 and phase 3 are quite low so it is expected to only reach about 70% compared to last year. Overall, the whole country in 2024 could decrease by 20-25% compared to 2023.
According to experts, signs of supply shortage compared to demand will continue to be recorded in the market in the near future. In addition, rapidly rising freight costs and port congestion in Asia also impact prices in import markets, and can cause shipping delays, causing prices to increase in the medium to long term. term.
The Pepper and Spice Association (VPSA) said data showed that by the end of July, Vietnam had exported an estimated 164,300 tons, with a turnover of 652 million USD, down 2.2% in volume but up 41%. % in value compared to the same period in 2023. The association estimates that Vietnam's pepper output in 2024 will only reach about 170,000 tons, down 10% compared to the previous year, this is also the lowest level in the last 5 years.
Source: VPSA (compiled by US)
Meanwhile, there are still about 6 months left until the new harvest (expected after the Lunar New Year from February 2025) while the amount of goods remaining with people, agents and businesses is not as much as VPSA previously assessed. This.
Mr. Le Duc Huy - General Director of 2/9 Dak Lak Import-Export Company Limited - Simexco said that Vietnam's inventory is about 30%, equivalent to 50,000 - 55,000 tons.
The Import-Export Department said that Vietnam's pepper industry will enjoy price benefits in the near future due to scarce supply. This can also open up opportunities for Vietnam to increase market share, further strengthening its position in key markets such as the US, China and Europe.
According to VPSA, the lack of supply will cause pepper prices in the near future to continue to have unusual fluctuations like on June 11 when the price increased sharply by 20,000 VND/kg in the morning but dropped sharply in the afternoon. return.
However, Mr. Huy said that in the first half of this year, Vietnam's traditional purchasing markets imported large amounts of pepper. This means that they are not in a hurry to buy more goods and are waiting.
Therefore, this person believes that although the supply shortage continues, pepper prices will hardly increase as strongly as at the beginning of the year.
“It is likely that pepper prices will remain at this level in the near future. Farmers still expect prices to increase dramatically again, but personally, in my opinion, this is very difficult," Mr. Huy said.
According to VietnamBiz.vn
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