PEPPERTRADE SPICES BOARD BLOG #Pepper #Spices: VIETNAM PEPPER & SPICES MARKET UPDATE 31ST MAY 2021

SPICES MARKET UPDATE

Pepper price today (May 31^st) fluctuates between 72,000 - 72,500 VND/kg. In the past 6 days, the pepper market fluctuated sharply, increasing from 5,000 VND/kg to 6,500 VND/kg in localities. With the increase of many times reaching 10% within just 3 days from early last week. However, at the end of week 21, pepper price increased by 7% and in whole this month May also increased by 4.5%.

Prices increased rapidly in the past week, many manufacturers and exporters surprising because the market still has difficulties and inadequacies such as; cash liquidity situation, freight are constantly increasing and it is difficult to get bookings especially to the USA, the epidemic situation is still complicated. However, the price of coffee and other agricultural products had an impressive increase in May, which stimulated farmers to sell coffee and increase pepper stockpiles. In addition, liquidity has gradually improved in the second half of May along with a sudden increase in buying from China.

Pepper prices this week in key provinces were significantly adjusted in an upward trend.

Although the increases are not as strong as 40-50% as in Feb / March, this price increase is considered sustainable, mainly due to export demand and purchase demand from many different countries such as the USA / CHINA / EU / ASIA... when the assessed inventory has decreased sharply over time. Almost have to continuing cover for Thirds and Fourth quarter shipment.

In May, it is forecasted that the number of pepper exports will reach 28,000 tons, bringing the total number of exports in the first 5 months of the year to 121,000 tons. The export volume decreased by 16% compared to 2020, but increase in the average export price, the export value still increased by 25%, reaching 387 million USD.

Malaysia; Although it is time to harvest the main crop, the serious disease situation has made it almost impossible for farmers to harvest and sell in the market. The main crop was thus severely affected and damage.

India; India will be reopening again during early next month June that make more demand coming in domestic market. After sometime interrupted due to Pandemic, almost try to ensure that purchasing and process. However, the processing are having difficulty for the domestic demand from Masala's manufacturers, when raw materials are not available. The difficulty in supply is pushing Indian pepper prices upward.

Brazil; Similar to Vietnam, Brazil's pepper price had a strong increase in the past week with an increase of over 10% from $ 3,600 FOB and currently at $ 3,950 - $ 4,000 FOB. Currently, Brazil's inventory is relatively low and production is forecasted to decrease sharply in 2021, besides the density of pepper will be difficult to reach as the BASTA standard as before. According to the information we received, Brazil is likely to face a severe drought from June to September and is forecast to be the worst drought in 91 years. This will definitely affect the output of pepper / coffee crop in 2021/2022.

https://www.reuters.com/business/environment/brazil-drought-alert-country-faces-worst-dry-spell-91-years-2021-05-28/

Indonesia; This year is forecasted to harvest in July & August, but according to many information, output will decrease by over 20% compared to the 2020 crop due to unattractive prices that have caused many farmers to switch crops and take less care of the pepper plantation.

Other information;

The epidemic situation is quite complicated in Vietnam today with a higher infection. A few cities in Vietnam have been locked down, major cities have officially implemented social distancing within 2 weeks. This can also affect the ability to transport and circulation of materials in the market.

Please note, in 2020, when Vietnam implemented social distancing, pepper prices had an impressive increase of over 50% in just 2 months. The situation in 2021 also has different changes, but the price trend maybe continue very stable next time.

We would like to send you a graph of the average pepper price from June to December in the last 10 years for your reference.

CASSIA/ STAR ANISE/ TURMERIC / GINGER;

The price of cinnamon has continuously increased rapidly due to great demand from EU / USA and ASIA countries. Especially great demand with cinnamon split / cinnamon cigarette / cinnamon broken cleaned…

Anise prices remain stable but the trend is forecast to increase due to strong demand from EU / USA and especially from China...