Vietnam is ruling the 2010 World Pepper Market

The first week of March showed a declining trend in Pepper prices lead by the new crop Vietnamese offers. Nevertheless as the week came to the end, the prices stabilized and are getting firmer.
Reports of good sales from Vietnam new crop to India and Europe show that the buyer´s interest is growing, and there is no fundamented reason for Exporters continue to offer further cheaper prices as Vietnam has no competition at the moment and, possibly, for quite a long time.

India´s crop touched its peak and India´s exports fell around 29% in January reduced to mere 1,500 ton, according a report from Reuters earlier this week.According the Hindu Business Line, " Aggravating their fear further, a report today said the Vietnamese exports in January stood at 7,240 tonnes and India was the third top importer from there, market sources told Business Line. No export demand from overseas, especially the US, was coming to India, of late, and it was being directed towards Vietnam and Indonesia which have been offering lower. A strong rupee against the dollar has made the Indian parity not competitive despite the fall in the futures market, they said."

Brazil is facing a very unfavourable weather since last November / December and the drought may reduce the crop in some 40% in 2010 (click here for more detailed report).
Brazilian exports for 2009 crop, measured between June 2009 and February 2010 were at 28,000 tons, so carryover stock might be estimated in around 6,000 tons, with no possibility of strong reinforcment in June due to the crash of Espirito Santo crop.
Further the Real rate begun to appreciate again, pulling thus the export prices further higher.

Last week, prices at the farm gate ranged from U$D 2,210 monday to U$D2,247 friday.
It is true that some sales happened for as low as U$D 2,550 for B1 550 gl but this was a sporadic occasion for making some cash. The lowest prices in Brazil stood at U$D 2,500 for B2 500gl and U$ 2,625 for B1 560 gl and U$ 2,700 - 2,750 for ASTA. However exporters are not interested in trade at these levels and, need just a tiny reason to increase their prices.

The only threat to Vietnam exporetrs might be poised by Indonesia, since in the last couple of years they increased again their sales in to USA. However their prices stood higher most of the time.

Reported prices average for the week were; Brazil ASTA U$D 2,750, Vietnam 580 gl ASTA U$D 2,900, India MG1 U$D 3,000. Cheaper qualities stood at U$D 2,650 500gl CLEAN from Brazil, U$D 2,350 500gl FAQ from Vietnam.

PEPPERTRADE EDITOR