Important Report - Brazilian Pepper Contracts

Since the middle of November when the rainy season finaly  came to Brazil, bad weather and heavy rains are threatening Pepper production areas disrupting delivery routes and processes causing a big mess in the pepper industru this end of the year.
We post below an advise from one of the most reputable spices operators in Brazil warning clients and explaining the situation.
Our understanding is due the situation, the trend of Brazilan Pepper for next month is upright

                                 State of Paraná, Guaratuba - road to the port of Parangúa

Situation of roads in the State of Espírito Santo

December 5, 2022

After another weekend of heavy rain across the state of Espírito Santo and, particularly, in the pepper growing and processing regions, the situation today is of extreme concern.

In addition to the roads banned last week, now more roads, accesses and bridges are being punished by the heavy rains that devastate the region.

Today some more roads are blocked, with landslides, erosion and affected bridge structures, which makes all vehicle traffic in these regions impossible.

In view of this, we communicate to our customers that all shipments are on standby, since without road clearance, access to the ports of Espírito Santo, Bahia and Rio de Janeiro are closed.

We are in contact with all exporters, carriers and freight forwarders so that we can ship what is possible at this time, however delays will inevitably occur due to the aforementioned situation.
We are still waiting for the positioning of the road bodies and authorities so that we can estimate the time needed for the situation to normalize.

So we ask our customers to be patient and know that we are full time working on this matter and as soon as we have any news, we will inform you immediately.

Best Regards,

Cris Guerreiro

IPC PEPPER MKT REPORT - HIGHLIGHT ON BRAZIL FEBRUARY 2021

 

HIGHLIGHT ON BRAZIL

Production and Productivity

Brazil as one of the major pepper producing and exporting countries known for its Black Pepper, has a more competitive price as opposed to other origins. Brazil cultivates its pepper partially in Para State (Pa) North of Brazil and Espirito Santos (Es) South of Brazil. Furthermore, Brazil has also surpassed Indonesia as the second largest pepper producer in the world with estimated quantity of 95,000 Mt in 2020.

During 2009-2020 the area under pepper cultivation in Brazil had fluctuated with an increasing trend. Between 2009-2016, area under pepper cultivation in Brazil saw a decrease by 6% to a total of 25,660 Ha from 27,415 Ha in 2009. The area under pepper cultivation in Brazil saw an increasing trend during 2016-2020 with an increase of 20% to a total of 30,700 Ha. In the course of 12 years between 2009-2020 total area under pepper cultivation in Brazil recorded an increase by 12% . Furthermore, in 2020 the area under pepper cultivation in Brazil was estimated to decrease by 1% as compared to 2019 to a total of 30,700 Ha. Whilst, for the year 2021 the area of pepper cultivation was projected to be stable and unchanged.

Brazil production of pepper during 2009-2020 was reported fluctuating with a rather positive trend. In the course 12 years since 2009 pepper production in Brazil was reported to have recorded an increase of 133% as it estimated a total of 95,000 Mt in 2020. The highest production of Brazil pepper in the course of 12 years between 2009-2020 was reported in 2020 with an estimation of 95,000 Mt whilst the lowest production occurred in 2012 with 32,000 Mt. However, in the year 2021 production of Brazil pepper was projected to decrease by 5% when compared with 2020 to a total of 90,000 Mt.

Pepper productivity in Brazil in the course of 12 years between 2009-2020 was reported to be fluctuated with a rather positive trend. During 2009-2020, the lowest pepper productivity in Brazil was reported in 2010 with 1,462 Kg per Ha while the highest productivity was reported in 2020 which was estimated at 3,094 Kg per Mt. The lowest decrease of pepper productivity in Brazil was reported to occur in 2016 as it recorded a 19% loss when compared with the previous year. Whilst the highest increase of pepper productivity was reported in 2017 which recorded a 45% increase as opposed to the previous year. For the year 2020, Brazil pepper productivity was estimated with an increase of 20% as opposed to 2019 to 3,094 Kg per Ha. Whilst in 2021 Brazil pepper productivity was projected with a decrease by 5% to 2,932 Kg per Ha .

Pepper Export from Brazil

Brazil, known as the second largest pepper producer in the world, had managed to take the second largest pepper exporter position from Indonesia in 2017. Since 2009 until 2020 there had been a significant increase of 151% or 53,986 Mt in the quantity of pepper exported from Brazil which was mainly dominated with black pepper as it contributed to 94% of the total export figures . The highest pepper export occurred in 2020 with 89,756 Mt whilst the lowest export occurred in 2012 with 29,129 Mt. In 2020, pepper export from Brazil was reported at 89,756 Mt which comprised of 86,166 Mt of black pepper and 3,590 Mt of white pepper. Thus, recording an increase of 6% as opposed to the previous year.

The number of pepper exports from Brazil had reportedly fluctuated in the last 2 years. The total export by Brazil in the past 24 months was reported at 174,432 Mt with total value as high as USD 364.9 Million. The average pepper export from Brazil was reported to be 7,268 Mt per month. The highest pepper export of Brazil occurred in October 2019 which reached 11,119 Mt whilst the lowest was reported in July 2019 with 3,046 Mt (Table 10). The high level of exports during that period (October) correlated closely to Brazil harvest season.

Pepper from Brazil is exported to various countries around the world (Table 11). In 2020, the top 10 country of destinations for Brazilian pepper were reported to be Germany with 13,281 Mt (Contributed to 15% of Brazil's total pepper export in 2020), Viet Nam with 12,173 Mt (14%), United States of America with 11,993 Mt (13%), Morocco with 7,486 Mt (8%), Egypt with 6,728 Mt (7%), United Arab Emirates with 5,117 (6%), India with 4,251 Mt (5%), Pakistan with 3,650 Mt (4%), Netherlands with 2,870 Mt (3%) and Mexico with 2,565 (2.9%).

Pepper Export Price

Brazil pepper export price had fluctuated significantly in the past three years which could be attributed to the world supply of pepper significantly exceeding the global demand. In 2018, the average export price for Brazilian pepper was reported at USD 2,835 per Mt with the highest prices recorded in January with USD 3,509 per Mt whilst the lowest price was reported in November with USD 2,195 per Mt.

In 2019, the average export price of Brazilian pepper was reported at USD 2,148 per Mt, recording a decreased of 23% as compared to 2018. In 2019, the highest price was reported to have reached USD 2,316 per Mt (July 2019) recording a deficit by 25% as compared to the same period in 2018. Whilst, the lowest price was reported in November with USD 2,002 per Mt, recording a deficit by 9% as compared to the same period in 2018.

In 2020, the average export price of Brazilian pepper was reported at USD 2,082 per Mt, recording a 3% decreased as compared to 2019. In 2020, the highest price was reported to have reached USD 2,412 per Mt (December 2020) recording an increase of 19% as compared to the same period in 2019. Whilst, the lowest price was reported in June with USD 1,888 per Mt, recording a deficit by 17% as compared to the same period in 2019 .

Source:

IPC MKT REPORT No. 38/20, 14 - 18 September 2020

 

 

MARKET REPORT

Market this week was reported positively. In local market, Malabar black pepper was reported with an increase of 2% as compared to the previous week to an average of USD 4,428 per Mt. Indonesia black and white peppers were reported with an increase of 3% and 2% respectively when compared to the previous week at an average of USD 1,951 per Mt for black pepper and USD 3,800 per Mt for white pepper. The increase of Indonesia pepper could be contributed to the increase of demand while the stock was limited despite new product coming to the market. Malaysia black and white pepper were reported with an increase of 1% respectively as opposed to the previous week averaging at USD 2,420 per Mt for black pepper and USD 3,807 per Mt for white pepper. Furthermore, Viet Nam black and white peppers in local market were reported stable with a marginal increase, averaging at USD 2,013 per Mt for black pepper and USD 2,831 per Mt for white pepper. Sri Lanka black pepper was reported with an increase of 2% as compared to the previous week and was traded at an average of USD 3,123 per Mt while China white pepper was reported stable and unchanged.

International market showed with a similar positive outlook. India black pepper was reported with the same 2% increase as compared to the previous week at an average of USD 4,700 per Mt. Indonesia black and white pepper were reported with an increase of 2% respectively as opposed to the previous week at an average of USD 2,386 per Mt for black pepper and USD 4,457 per Mt for white pepper. Malaysia black and white pepper continued to be reported stable and unchanged. Furthermore, Viet Nam black pepper 500 g/l, 550 g/l and Viet Nam white peppers were reported with an increase of 1% respectively when compared to the previous week averaging at USD 2,500 Per Mt, USD 2,581 per Mt, and USD 4,020 per Mt respectively. China white pepper was reported stable and unchanged.

 

 

VIETNAM SPICES MARKET UPDATE 17TH AUGUST 2020 – WEEK 34

 

PEPPER
Last week, the pepper market increased about 2% with demand from China and the Middle East. The USA still shows a relatively small demand and only accepts to buy long time shipment orders while almost Vietnam exporters hesitate or withdraw. The EU is on holiday so demand continues to be quiet. We hope the market will be better next time when some countries reopen again.  In addition, Russian have found vaccines/India and the USA are also testing many vaccines in the final stage. Hope everyone/all of the world will be healthy, starting a new business cycle soon.

Current weather in Vietnam; After fluctuating and flooding, the weather is currently well evaluated in key pepper areas such as Daknong & Daklak. Impacts of the 2021 pepper crop are likely to be low in these two key provinces. We will send more information after the survey next October.

 Indonesia; According to the information received, the heavy rain and flood took place on a large scale, so the crop heavily affected both black and white pepper. Currently Indonesian prices are at a very high level with a reference price of $ 2,550 – 2,650 LASTA and $ 4,150 for FAQ white pepper.

 Brazil; Currently, it still offers competitively, but mainly delivered in quarter 4/2020

 

CASSIA
Heavy rain and flooding happen in the largest cinnamon area in Vietnam. Therefore, the harvest for the 2020 crop is affected and the price of cinnamon is likely to remain stable as demand from EU/USA/India/Bangladesh still supports the market.

 

STAR ANISE
The amount of inventory is still tight. The price is expected to be stable or increase in the coming time.

 

 

 

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VIETNAM PEPPER MARKET UPDATE 27TH JULY 2020 – WEEK 31

 

 

Viet Nam
According to preliminary data of Vietnam Customs, pepper exports in June 2020 reached only 20,449 tons, less 9,902 tons, a sharp decrease of 32.62% compared to the previous month and down 10,236 tons, or 33.36% less than the same period last year 2019. The pepper export turnover in June reached $47.17 million, down $13.74 million, or 22.55% down from the May 2020 and down $28.04 million, or 37.28% compared to the same period last year.

Accumulated export volume of pepper in the first 6 months of 2020 reached 166,812 tons, down 10,046 tons, or 5.68% compared to the export volume in the first 6 months of 2019.

The average export price in June 2020 reached $2,306/ton, up 14.95% compared to the average export price of May 2020.

The same export, Vietnam imported a sharp decrease compared with 2019 when total quantity only 14,899 tons of pepper, including 11,283 tons of black pepper and 3,616 tons of white pepper. Compared to the same period in 2019, import volume decreased by 34.3%. Vietnam imports pepper mainly from Brazil, Indonesia and Cambodia. In which, the import from Brazil was 100% black pepper with 5,802 tons, down 34.9%; imports from Indonesia reached 5,528 tons (of which 2,057 tons were black pepper and 3,471 tons were white pepper), down 50.4% over the same period.

Until July 20th, 2020, Vietnam exported 9,942 tons of pepper and is forecast to export 16 - 17,000 tons in this month, bringing the total export volume in the first 7 months reached 183,812 tons (first 7 month 2019 exported 203.737 tons).

Pepper market in week 30^th 2020 has increased slightly by 2% compared to week 29. The main reason is that exporters focus on covering raw material to ensure time shipment has been done before.

In general, demand in week 30^th more than week 29^th when many different countries have gradually increased production again after a long time restrained due to Covid 19 (especially EU/India). Demand is still quite slow but many requests from the EU/US for long shipment orders from Q4/2020 until the end of 2021.

The market is still quite sensitive and the price trend is likely to be quite stable in the near future.

 Brazil
Almost the same previous week when only possible to offer very limited quantities but not for prompt shipment. Delivery time is mostly in September/October as a seller option. We can foresee Vietnam exporters will not be hedging raw material from Brazil from now.

 Indonesia
Currently harvesting but less offered. Prices are still higher than Vietnam both black and white pepper especially muntok white pepper.

EXPORT OF PEPPER BY BRAZIL

June 26/2020
Brazil, known as one of the major pepper producing countries known for its Black Pepper, is reported to have a more competitive price as opposed to other origins. In recent year, Brazil has also surpassed Indonesia as the second largest pepper producer in the world with estimated quantity of 80,000 Mt in 2019. Brazil's increase of production could be contributed to the output of the first harvest of new plantation planted in 2017. Brazil, had also managed to take the second largest pepper exporter position from Indonesia in 2017.

In 2018, Brazil was reported to have exported a total of 72,580 Mt of pepper from which 99.8% or 72,456 Mt of it comprised of whole pepper and 0.2% or 124 Mt of it ground pepper. Brazil on average exported a total of 6,048 Mt per month in 2018 which peaked in November with 12,791 Mt. The highest pepper export in November was due to pepper harvest in Brazil during September-November. The total revenue of Brazil's export of pepper in 2018 was reported to be as high as USD 194.9 Million. Thus, recording the average price of the total pepper exported by Brazil at USD 2,687 per Mt for whole pepper and USD 1,952 per Mt for ground pepper.

Year 2019 saw an increase in term of quantity of pepper exported by Brazil. Brazil was reported to have exported a total of 84,676 Mt of which 99.9% or 84,607 Mt of it comprised of whole pepper and 0.1% or 68 Mt of it ground pepper, recording an increase of 17% when compared with 2018. The average export of pepper by Brazil in 2019 was reported to be at 7,056 Mt per month which peaked in October with 11,119 Mt.

Although increasing in terms of quantity, Brazil's revenue from pepper export was reported with a decrease by 8% as compared to the previous year to a total of USD 179.6 Million. Thus, recording an average price of the total pepper exported by Brazil at USD 2,121 per Mt for whole pepper and USD 1,766 per Mt for ground pepper or a decrease by 21% and 10% respectively as compared to 2018.

As of May 2020, Brazil was reported to have exported a total of 42,813 Mt which 99.8% or 42,741 Mt of it comprised of whole pepper and 0.2% or 72 Mt of it ground pepper. Thus, recording an increase of 8% when compared to the same period in 2019. As of May 2020, the total revenue of pepper export by Brazil was reported to have reached USD 82.0 Million, recording a decrease by 4% as compared to the same period in 2019. The average price of the total pepper exported by Brazil as of May 2020 was reported at USD 1,917 per Mt for whole pepper and USD 1,062 per Mt for ground pepper.

Pepper from Brazil is widely traded in America, Africa, Asia and European countries. As of May 2020, Brazil's top 5 Country of destinations for its pepper were reported to be United States of America with 5,911 Mt (an increase of 25% as compared to the same period in 2019), Morocco with 5,041 Mt (an increase of 73%), Viet Nam with 4,323 Mt (a decrease of 0.1%), Germany with 4,091 Mt (a decrease of 11%) and Egypt with 3,830 Mt (an increase of 66%). 

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