BLACK PEPPER STARWAR

This e-mail was received and distributed by ABEP - Brazilian Pepper Exporters Association and shows how the Black Pepper market strugle - The Bulls X The Bears...
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Dear Nagano San,

I would like to make a clarifications that Indonesian market never been weak in term of locall price. The price down from 4300 to 4100 only because of indonesian currency is weak again usd . In fact locall market price is very steady and strong eventhough the crop is starting coming in. Parity fob still in level usd 4100/mt without profit. Therefore Indonesian exporter must sell above this level in order to get some profit. Furthermore i never saw and heard in Usa market or Europe market Indonesian exporters being agressive to make an offer or try to sell cheap. Indonesian exporters until today dd.2 August very quiet and silent in the usa and europe market. No body really want to do anything due to steady locall market. I am sure the informations that has been spread in Brasil about the weak of Indonesia prices definatelly to mislead market price and in order to press the market in Brasil and this is the only ways to get the brasilian exporters nervous and willing to sell cheap price and foward shipment. Specailly when exporters and other who does not understand the real market situations for supply and demand will be nervous regarding the mislead market informationsof other origin down from whoever has intentions and interest to buy cheap.
For your knowledge right now many peoples use Indian futures market price to attack Indonesian exporters and try to get Indonesian exporters willing to sell cheap and follow the futures market in India. But unfortunatelly it does not work because Indonesian exporters fully awares of this tricks and we are fully awares that export out of India and import out of india since jan -june are still much more import than what they export. This export include the finish product such as oleoresin and ground products. And we fully understand that futures market in India only for peoples want to gamble in the paper . If we are talking Mg1 and try to buy real black pepper from local collector and farmers, definatelly we can not buy any black pepper because their local makret price much higher than exchange price.
If one day there are crazy people who has money and want to gamble and buy alot in futures exchange in India for nearby and later positions and keep holding the positions. I am sure that futures exchange in India will be cheos and price in the exchange will be up to the roof.
Hope this explanations can help you to explained to your exporters freinds in Brasil.
Finally the most important origin must understand the momentum of the pepper prices must be back to basic supply and demand. When the supply is much less than demand we must see the price must go up. Everybody can not run away from these facts.

Rgds
Yuli

Pepper Exports from India

KOCHI – Bafana Enterprises, a Kochi-based spices processing and export firm, received highest amount of 15 mln rupees under the rupees 7 per 1 kg pepper export subsidy scheme during 2006-07 (Apr-Mar), by shipping 3,350 tn of Indian pepper.
Commerce ministry has provided 7 rupees per 1 kg as freight subsidy to boost pepper exports from the country during 2006-07.
The subsidy was limited to the export of a maximum of 20,000 tn of the commodity. India exported 28,750 tn pepper during the year.
Bafana also exported pepper to non-traditional markets such as Taiwan, Philippines, and Dominican Republic etc. during the year, said its Chairman Ratanlal Bafana.
New markets may appear insignificant in terms of quantity and value but they have helped to sustain momentum of exports during the year, he added.
Supply squeeze in Vietnam from later half of 2006 might have prompted buyers from these places to turn to India, he said.
"We have made a good beginning in non-traditional markets like Taiwan and we hope to build on it in coming days," he said.
Pepper exports from India to Taiwan rose to 236 tn during 2006-07 compared with 30-40 tn in preceding years, according to a Spices Board official.
Exports to Philippines also rose to 112 tn from a low level of less than 40 tn during the year, he added.
Top seven pepper exporters received around 80 mln rupees out of the total subsidy amount of 140 mln rupees during the year.
Kishore Shamji, another leading exporter, received 14 mln rupees under the subsidy scheme by exporting 3,000 tn. End

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FROM VIETNAM

7 June 2007.

Dear valued Buyers,


Pepper is very interesting markets in this year, prices are up, up so much and make many people are very nervous to trade this item. Nobody think it is high like that!!! Increadible prices, from usd 2,400 per mt to USD 2,700 per mt and until sometimes up to usd 3,950 fob for 500 gr/l. so many buyers/traders are reluctant to buy pepper, many processing factories in EU decided not to buy at high prices and wait. From Feb 2007 they wait prices better in Mar but prices was up, up and they have waited until now is FH June 2007. some factories they use last berries to process and hope prices comeing down.

The Giant traders are have not better positions. They sold alots forward contracts at cheap and hope they can cover in Mar/April and they told many buyers in EU not to buy and wait, prices would be sure down in Mar/April however until end May/FH June prices are not really better!!! And they sold already, many contracts need to be delivered. Some traders in Origin they don’t deliver, the Big traders are negotiating with buyers to delay 2 or 3 months to help them not to get BIG LOSS, many short positions we can see from very BIG traders in HOLAND in Vietnam. Some buyers agreed but some asked them to ship on time since they need very much pepper to process!

And we heard that some BRAZIL sold forward positions at very cheap levels!!!

What they(Big traders) have to do now??? They pread news to all buyers in EU/American not to buy to press prices down! therefore there is not so many demands from EU/America. Buyers wait, another hand traders continue to buy to cover their positions which some processing buyers not to agree to ship pepper late.

So one question! How many tons VN have? If VN have more quantity, prices shud be down but as you see many times prices are easy alittle bit, and then it goes up shuddenly!!! Sine NOT MUCH PEPPER left!!! And one thing is the true is that NEXT YEAR crop is worst than this year so prices will be very high since the farms/trees are in insects postions and many trees are dead!!! And insects spread out to next farms with high speed so we can say 40% Less quantity in Crop Next Year 2008!!!

Thank you very much and we do hope buyers/processing buyers have right decision to purchse goods on time with correct prices.

Kind regards,
Phan Minh Thong
----------------------------------------------------------------------
PHUCSINH COMPANY LIMITED.

Re: Black pepper market has been flat

Well am an importer of Black Pepper in Pakistan.
In the last day or two market for black pepper has suppenly stopped and has reversed a lot.
Rumors effect a lot in a speculative market.
10 days back it looked that the vietnam prices might reach usd4400 or usd4500/pmt for 500gl,as there was no offer from any other country.
But suddenly from no where Malaysia is offering stock,Srilanka is offering,Indonesia is also offering.
And now no buyers.
The way i look at the current situation, Vietnam 2007 crop is damaged,maximum damage could be up to 20%.In the past Vietnam has been exporting like 120,000mt per year.Less 20% still 100,000mt of crop.
And till now the export demand has been very less due to the higher prices.
I ve heard that till now only 25000mt or more have been exported in this quantity last year carry over is also included.
May almost finished,july Brazil crops starts.
So i think that vietnam will have to lowers its prices.
Anonimous

Re: Black pepper market has been flat

End Users demand has been decreasing whereas re-sellers are only buyers..............................A note of danger.........actual users have not bought when the exports were at peak(Q1)........In April the exports were poor overall................so chances of them buying is dull. I feel the market to go down sharply........
BE CAUTIOUS A GREAT FALL MAY BE AWAITING

SURESH

Re: Black pepper market has been flat

it is a false news that vietnam decresed its price .in vietnam still there is no seller
Anonimous

India - Pepper crashes big today

Dear M W,
Pepper crashes big today !!!
MG I asta grade at $ 3550 pmt fob cochin for prmpt
buyers are gone, sellers on top.
Thanks / b rgds

Re: Black pepper market has been flat

Stocks in warehouses of NCDEX are seen at 8490 MT.
Vietnam has not given any clue to global traders regarding its export intentions.
Buyers like China, USA etc prefer to watch the global activities for a while. This explains slower trading activity across the world during the week ending May 19th.
Producers’ offers in India are averaging around USD 3430-3435/MT ex-Kochi - down 1% from previous week.
Meanwhile the FOB markets maintained a steady trend throughout the previous week.

Abhijeet Banerjee

Black pepper market has been flat

For 2 weeks in a row black pepper market has been flat with no buyers interest and still no prices decline could be foreseen in Brazil.
Vietnam reported some ease with 500 gl prices offered at U$D 3,600 today.
Indonesia also easier - U$D 3,850 pmt Lasta.
Brazilian farmers and exporters are holding firm on the 3,800 pmt fob level for the B1 560 gl. possibly due to continuos advises from ABEP that market will continue strong. On the other hand the weakness of the dollar does not help much to accept cheaper prices - it reached the cheapest price in 6 years - today R$ 1,94 / U$ 1,00
This week we publish the new brazilian export statistics for the first quarter. Also USA statistics for the first trimester are available.

INFO VIETNAM

Dear Sir,

Thks for info.
May I point out few aspects?

a- We think the rally is not finished as in Vietnam:
1- Crop 07 (85% harvested) has dropped by at least 20% to reach +/= 90,000 Mt (old trees, low yield due to lack of fertilizer , insect damage on roots), and for the following years, it should stand below 100,000 mt.
2- Low carry over from 2006.
3- Farmers are also in strong position as they do not produce only pepper but other commodities (coffee price was good this year > 1,400$ /mt) or spices.
4- Delays and defaults occurring also.

b-
1- On top of that Indonesia crop still show some weakness in their production (2006<35,000 Mt) and local prices are higher than Vietnam.
2- World offer/demand seems to be in deficit of at least 10%.
3- Low stocks in Consuming countries (mainly is US and Europe)
4- China and India still increase their consumption.

Although it will happen that at some point (4,500$, 5,000$??), Vietnamese farmers start selling but intermediary traders may hold part of it it as well. Rumors that outsiders of spice business start having long position of Pepper and we don’t expect them to release their position for few hundred dollars only!!

We remain bullish torward this market. As soon as we break the psychological level of 4,000$, the roof is open!

Keep in touch and further infos about Brazilian crop will be appreciated.
Thks & Brgds
Francois Bouvery
Sucrex-Export SA (Sucrex-Asia Vietnam)

Pepper Mkt overview

Pepper Price is set to hit another round of bull-run in the next few days due to sellers’ mostly cutting supply in major producing countries. According to our analysis in major consuming countries carryover stocks are fast getting depleted with limited scope for ready replacement.

Over dependence on single source for quite sometime is the main reason for the present predicament. Buyers from all over the world had an opportunity to contract quality Malabar pepper at reasonable levels of U.S. $1.2-1.35 before the bull run started in right earnest. Exporters in India were in a position to deliver substantial quantities due to the huge turnover in commodity exchanges. Average turnover in these exchanges is around 60,000 mt with the near month contracts always having good liquidity.

The situation has undergone a major change as the largest producer and exporter opting for a staggered selling strategy by holding on to stocks. This has created a new situation for global pepper industry and in this scenario commodity exchanges in India are fast turning out to be brand ambassadors for Vietnamese pepper growers and sellers.

Several investors with backing from funds are now involved Malabar pepper India’s commodity exchanges and the next month contract is having a premium of 40%. Exporters of black pepper from India are doing more deals in these commodity exchanges since February as they are assured of high returns without the hassles of shortage in weight, light berries, excreta presence etc. Exporters also receive the payment as early as 48 hours. Buyers need to come with innovative ideas to deal with the new situation as exporters from India are not having any compelling reason to chase buyers.

According to our analysis coming two weeks will be very interesting to watch . So wait and see what’s going to happen in black gold in the next fortnight.

Best Regards

Jojan Malayil

Pepper Price to go further up

Gentlemen,

Re your "vernoticia" report dtd 2007/04/17. Please note from our view point:

1. Brazil is unable to offer easily, because the remaining carryover is too reduced and growers thinking very high prices henceforth, i.e. R$10,00/kg, which means, abt USD5.000/ton at growers.

2. Growers seeing a new crop 2007 very small, so, they prefer await elsemore.

3. Vietnam has just jumped up from VND44.000/kg to VND49.000/kg and who knows tomorrow or a little more ahead it will achieve?

As far as everybody are concerned, upon Asta meeting time, all the world trading has a stopover.

Best rgds
Nonato Moreira
President - ABEP