PEPPERTRADE SPICES BOARD BLOG #Pepper #Spices: VIETNAM PEPPER MARKET UPDATE 5TH OCT 2020

Vietnam; Exported roughly 19,120 tons of pepper in September bringing the total first 9 months of 2020 to 221,036 tons. Compared to the same period in 2019, the quantity of exports has decreased by 12.370 tons, equivalent to a decrease of 5.3%, the price today is 20% higher compared with the same time in 2019.

However, the prices, still much lower than farmer expectations while labor cost/interest rate is increasing yearly, have put pressure on increased credit debt, which has pushed most farmers in key growing areas of Vietnam into a difficult situation. In the past few years, pepper prices have been low, many farmers no longer invest in and take care of pepper plantations as before. As a result, although the acreage of pepper has decreased only around 10 - 15% but many pepper plantations have been exhausted make decline in overall productivity. A significant decrease in output from Vietnam starting this year and continuing to happen next few more years could contribute to a sharp decrease in the global supply of pepper even crop size may increase in Brazil/India next year..

Last week, pepper demand globally was low, but the Vietnam pepper pricing continued to move sideways with little change. After a long holiday in the first week of October in China, we expect global demand to increase in the next 1 or 2 weeks for 4th quarter shipment.

Cambodia; According to statistics, pepper prices decreased from 9-10 USD/kg in 2016 to 2.5-3USD/kg in 2018 and only 1.5-2 USD/kg in 2019-2020. However, production cost is still at 2.59 USD/kg. For this reason, many pepper growers and pepper processors have cut down on labor, limited maintenance on farms and some have even given up growing pepper to switch to other products.

Indonesia; continued to offer black pepper at quite competitive prices, but the price of white pepper was still very high compared to the whole market at 4,100$ - 4,250$/MT despite some downward trend due to low demand.

Brazil; Still continuing to offer in line, the density of pepper lower than expected were reported from many different importers in Vietnam and not easy to offer BASTA quality at the moment.

Malaysia; black and white pepper recorded stability with a slight decrease, averaging at USD 2,418$/ton and 3,802$/ton, respectively

Sri Lanka; black pepper recorded an increase of 1% compared to last week, averaging at 3,140$/ton

Chinese; white pepper was stable with a slight increase and traded at an average rate of 4,100 USD/ton.

India; black pepper was reported with an increase of 2% compared to last week, averaging at 4,776 USD/ton. New crop 2021 we heard maybe better than 2020.