IPC PEPPER MKT REPORT No. 14/21, 29 March - 2 April 2021

LOCAL MARKET REPORT

Market this week showed a rather positive response with only Sri Lanka was reported with a decrease. In local market, Malabar black pepper was reported with an increase of 2% when compared to the previous week, averaging at USD 5,075 per Mt. Indonesia black and white pepper were reported with an increase of 11% and 14% respectively when compared to the previous week, averaging at USD 2,997 per Mt for black pepper and USD 6,028 per Mt for white pepper. The increase of Indonesian pepper price could be contributed to the increase of demand amidst the limited stock. Though farmers' stocks depleted, it was reported that some speculators bought a hefty amount for their in-stock and further business. Malaysia black and white pepper were reported with an increase of 5% and 3% respectively as compared to the previous week, averaging at USD 2,679 per Mt for black pepper and USD 4,097 per Mt for white pepper. Viet Nam farm gate price of black pepper was reported with an increase of 1% as compar ed to the previous week, averaging at USD 3,035 per Mt. Whilst, Viet Nam white pepper was reported stable, averaging at USD 4,710 per Mt. Furthermore, Sri Lanka black pepper was reported with 2% deficit as compared to the previous week and was traded at an average of USD 3,290 per Mt. China white pepper was reported with an increase of 1% as opposed to the previous week and was traded at an average of USD 6,185 per Mt locally.

INTERNATIONAL MARKET REPORT

International market was reported with a positive outlook as India black pepper was reported with the same increase of 2% when compared to the previous week, averaging at USD 5,348 per Mt. Indonesia black and white pepper were reported with an increase of 10% and 13% respectively when compared to the previous week, averaging at USD 3,583 per Mt for black pepper and USD 6,949 per Mt for white pepper. Malaysia black and white pepper were reported with an increase of 5% and 4% respectively as compared to the previous week, averaging at USD 4,225 per Mt for black pepper and USD 5,560 per Mt for white pepper. Furthermore, Viet Nam black pepper 500 g/l, 550 g/l and Viet Nam white pepper were reported stable and unchanged. China white pepper was reported with an increase of 1% as opposed to the previous week and was traded at an average of USD 6,385 per Mt.

The price of pepper in the US market remained high as Muntok white pepper for CF April/May was reported at USD 7,300 per Mt. 

 

 

THE EVER GIVEN REFLOATED, THE SUEZ CHANEL IS FREE... WHAT NOW ?

Although the blockade on the Suez Canal has been resolved, the consequences of this event will continue to impact global supply chains in the coming months.

Therefore, we highlight some critical issues that require greater care and contingency planning:

Backlog
Approximately 400 ships are still standing in line, on both sides of the Suez Canal, and the situation is expected to last until the weekend (a time considered quite ambitious by some experts). Therefore, interruptions and delays in the maritime schedule are expected, particularly on the Asia-Europe route.

Port congestion
As soon as the ships are released from the Suez Canal, the backlog of cargo ships begins to obstruct the ports in Europe and Asia, since the vessels will arrive at the same time at the destinations.

Imbalances and equipment shortages
The week-long shutdown of the Suez Canal “held” tens of thousands of containers, unbalancing the availability of equipment. Empty containers in Asia, limited even before this incident, will become even scarcer, significantly delaying the export shipment process.

When the flow of goods returns to normal, spring will be over and many of the goods (seasonal or special) may no longer be needed. European exports are obviously affected in a similar way due to the lack of equipment, also impacting other trade routes, such as that of the Americas.

Free time reductions (detention, demurrage, storage)
The challenges mentioned above require operators and terminals to trigger all available management contingencies, including reducing the free time of containers, anticipating the imposition of fees.

Schedule alignments, route adjustments, blank sailings
In addition to the blockade of the Suez Canal, the redirection of other vessels through the Cape of Good Hope caused an even greater disorder in the navigation schedule. For this reason, shipowners will announce blank sailings, that is, the cancellation of berthing in certain ports, reducing the ability to start the recovery process of the schedules. This will affect all service cycles until at least the month of May.

Rate increase, booking interruption
This whole scenario is increasing operating costs in the maritime transport sector. In addition, with around 7% of world oil passing through the Suez Canal, we may experience temporary fuel shortages and possible price increases. Fees and surcharges will increase further. Many shipowners have already started to cut allocations, especially Named Accounts (NAC), and are applying premium rates. They also imposed selective blocking of reserves.

Air and rail freight from Asia to Europe may change, as demand for alternative modes of transport has increased and capacity is also limited.

Bearing in mind that this is an unprecedented situation, together with the challenging market dynamics in the midst of the Covid-19 crisis, it is clear that it remains to be seen how all this will evolve.

There is a high probability that the situation will last at least until the month of May, and normality will not return until the second half of the year.

DHL Global Forwarding monitors the situation very carefully and will continue to provide relevant updates as they become available. Contact your local representative to review and discuss your potentially affected shipments in progress.



DHL Global Forwarding

*Picture by Getty Images
*Original in portuguese, translated to english by Google Translator

IPC REPORT: IMPORT OF PEPPER BY SOUTH AFRICA

 

South Africa, officially the Republic of South Africa (RSA), is the southernmost country in Africa. South Africa's considered as one of pepper producing country albeit in a smaller scale, pepper cultivation is reported in the Lowfeld of Mpumalanga Province and KwaZulu Natal Province. However, South Africa's pepper production is unable to meet the domestic consumption which resulting to import from various pepper producing countries for domestic consumption or for re-export.

In 2018, South Africa was reported to have imported a total 3,731 Mt of pepper which 63% or 2,352 Mt of it comprised of whole pepper while 37% or 1,378 Mt of it was ground pepper. The average import of pepper by South Africa in 2018 was reported to be 311 Mt per month with the highest quantity recorded in August with 413 Mt. The total expenditure of pepper import by South Africa in 2018 was reported to be as high as USD 17.4 Million, recording an average price of the total pepper imported by South Africa at USD 3,931 per Mt for whole pepper and USD 5,939 Per Mt for ground pepper.

Year 2019 saw an increasing trend in term of quantity of pepper imported by South Africa. South Africa was reported to have imported a total of 4,286 Mt which 63% or 2,719 Mt of it comprised of whole pepper and 37% or 1,568 Mt of it was ground pepper. Thus, recording an increase of 15% when compared to 2018. The average pepper import by South Africa in 2019 was reported at 357 Mt per month which peaked in July with 493 Mt. Although increasing in terms of quantity, South Africa's expenditure of pepper import was reported with a decrease of 15% to a total of USD 14.8 Million. Thus, recording an average price of the total pepper imported by South Africa at USD 2,955 per Mt for whole pepper and USD 4,368 per Mt for ground pepper or a decrease by 25% and 26% respectively as compared to 2018.

In 2020, Pepper import by South Africa was reported with an increase of 7% as compared to 2019, totaling at 4,571 Mt which comprised of 53% or 2,435 Mt of whole pepper and 47% or 2,135 Mt of ground pepper. The total expenditure of pepper import by South Africa in 2020 was reported with a decrease by 6% when compared to 2019, totaling at USD 13.9 Million. Thus, recording an average price of the total pepper imported by South Africa at USD 2,773 per Mt for whole pepper and USD 3,381 per Mt for ground pepper or a decrease by 6% and 23% respectively as compared to 2019.

The top five countries of origins of South Africa's pepper in 2020 were reported to be Viet Nam with 3,260 Mt (an increase of 6% as compared to 2019), Brazil with 335 Mt (a decrease of 14%), China with 231 Mt (an increase of 60%), Thailand with 218 Mt (a decrease of 6%) and India with 107 Mt (a decrease of 27 Mt). The decrease of South Africa's import from Brazil and India could be contributed to South Africa preference of importing from other origins such as Viet Nam (an increase of 174 Mt as compared to 2019) and China (an increase of 87 Mt). 

 

 

IPC PEPPER MKT REPORT No. 13/21, 22 - 26 March 2021

 

 

 No. 13/21, 22 - 26 March 2021

LOCAL MARKET REPORT

Market this week showed a rather positive response with only Viet Nam local price was reported with a decrease. In local market, Malabar black pepper was reported with an increase of 1% when compared to the previous week, averaging at USD 4,980 per Mt. Indonesia black and white pepper were reported with an increase of 8% and 12% respectively when compared to the previous week, averaging at USD 2,699 per Mt for black pepper and USD 5,295 per Mt for white pepper. The increase of Indonesian pepper price could be contributed to the increase of demand following Viet Nam's short and the limited stock. Malaysia black and white pepper were reported with an increase of 2% and 1% respectively as compared to the previous week, averaging at USD 2,559 per Mt for black pepper and USD 3,991 per Mt for white pepper. After experiencing significant increase in the last five weeks, Viet Nam farm gate price of black and white pepper were reported with 4% and 2% deficit respectively as compared to the pr evious week, averaging at USD 2,997 per Mt for black pepper and USD 4,716 per Mt for white pepper. Furthermore, Sri Lanka black pepper was reported with an increase of 10% as compared to the previous week and was traded at an average of USD 3,341 per Mt. China white pepper was reported with an increase of 10% as opposed to the previous week and was traded at an average of USD 6,134 per Mt locally.

INTERNATIONAL MARKET REPORT

International market was reported with a positive outlook as India black pepper was reported with the same increase of 1% when compared to the previous week, averaging at USD 5,256 per Mt. Indonesia black and white pepper were reported with an increase of 8% and 12% respectively when compared to the previous week, averaging at USD 3,245 per Mt for black pepper and USD 6,132 per Mt for white pepper. Malaysia black and white pepper were reported with an increase of 2% and 1% respectively as compared to the previous week, averaging at USD 4,010 per Mt for black pepper and USD 5,360 per Mt for white pepper. Furthermore, Viet Nam black pepper 500 g/l, 550 g/l and Viet Nam white pepper were reported stable and unchanged. China white pepper was reported with an increase of 9% as opposed to the previous week and was traded at an average of USD 6,334 per Mt.

US market since last week was reported to highly fluctuate and behave uncontrollable due to cargo situation as well as the lack of offer. Muntok white pepper in US Market for CF April/May was reported at USD 6,100 per Mt.

VIETNAM SPICES MARKET UPDATE 22nd MARCH 2021 – WEEK 12

 

PEPPER

According Customs's data, in the first 15 days of March, Vietnam exported 13,928 tons of pepper, with a turnover of 40.1 million USD.
Accumulated from 1/1 to 15/3/2021, Vietnam exported 44,135 tons, total turnover reached 127.4 million USD.
It is forecasted that by the end of March, Vietnam will export 59,250 tons of pepper.
Thus, the export volume of pepper from Vietnam is expected to decrease to 21,844 tons,
equivalent to a decrease of 37% compared to the same period in 2020 (in 3 months of 2020, Vietnam exported 81,094 thousand tons).

Meanwhile, in the first 2 months of 2021, Vietnam imported 5,313 tons, increasing by 13.8% over the same period last year.

The pepper market last week has fluctuated with a very large and unpredictable amplitude.
Achieve a 15% increase in just 3 days and then adjust to decrease again.
However, at the end of the week, pepper prices still increased by 4.2% compared to March 15th and an increase of 40% compared to February 17, 2021.

The agricultural market is forecast to be fierce and sensitive throughout 2021.
Therefore all parties such as farmers, agents, exporters and buyers should be cautious when deciding to enter the market.

Please refer to the following chart

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

VIETNAM SPICES MARKET UPDATE 15th MARCH 2021 – WEEK 11

 
PEPPER;

 

In February, Vietnam exported 13,428 tonnes of pepper, with the export value reaching 38.92 million USD. Compared to the previous month, the export volume decreased by 20.5%, the turnover decreased by 20.1%. Accumulated in the first 2 months of 2021, Vietnam exported 30,291 tons, worth 87.56 million USD. Although pepper prices have increased rapidly, the export quantity and export turnover of this commodity has decreased sharply by 21.4% (quantity) and 25.3% (export turnover) in the same period last year. 

Last week, pepper prices continued to rise sharply with an increase of 20% in just 7 days. Especially, there was a day when the market increased and decreased with an amplitude of 12%. (On March 8 - March 9, after a hot increase of 12%, it decreased to 12% in just 24 hours, then continued to increase strongly again.).  

Within 1 month (from February 17, 2021, to March 14, 2021), the price of pepper has increased by 40%.

Please refer to the following chart;

The market rose so hotly that manufacturers/exporters had to come and meet together from Friday last week to analyze the main reasons that have strongly impacted the market during the past time. The main cause as well as we have sent it briefly to you in the last week.

 

"Re-quoted - market update week 10th as below"

 

Despite being in the harvest season, raw material prices continue to rise steadily due to the following main reasons;

 

- Many farmers are at a loss even at this price due to having a poor crop, almost all consider storing pepper. Farmers and domestic agents prefer to sell other agricultural products like Coffee to cover temporary costs and store as much as they can. From their perspective, pepper is the most attractive to invest in compared to other agricultural products. Some rich farmers even buying from others to stock continue.

- Pepper's price is at an attractive level has stimulated many exporters/domestic agents to buy stocks. Especially, there are large enterprises with FDI capital actively participating and pushing the market up sharply in the last time. Pepper harvesting fully swings in all areas in Vietnam however it is not easy to buy in bulk.

- China and Domestic speculators buying very aggressively after Lunar New Year. Demand coming from Middle East/India for March/April shipment. USA customers are more interesting to cover full-year shipments but processors/exporters hesitate to offer further shipments.

 - Several exporters are big short and have been buying raw material in secret in order to ensure shipment on time to the buyers.

 

 Regarding price's flowchart from 2010 - 2020, we can see that pepper prices of 2021 go against most of the previous years when increased rapidly in peak season (quite similar with price fluctuations in 2011 - 10 years ago). Prices increased continuously which surprised all producers, exporters and importers. Currently at this price level, some farmers have become profitable, last week quite a lot of farmers in the Central Highlands provinces actively hired many workers to harvest quickly and sell to domestic agents when the raw material prices reached their expectation.

 

With the large amplitude increase and decrease and dependence on speculation (farmers / domestic agents / China/traders), we think that the market is at a rather high-risk level. Therefore all the relative parties (producer/exporter/buyer) should be careful when entering the market. (Although in the medium and long term, we think it is still uptrend)

SEE TODAY´S PRICES FROM VIETNAM:
https://offers-peppertrade.blogspot.com/2021/03/

 

IPC PEPPER MKT REPORT No. 11/21, 8 - 12 March 2021

 

LOCAL MARKET REPORT

Market this week showed a mixed response with only Malaysia local price was reported with a decrease. In local market, Malabar black pepper was reported with an increase of 1% when compared to the previous week, averaging at USD 4,715 per Mt. Indonesia black pepper was reported with an increase of 1% when compared to the previous week, averaging at USD 2,359 per Mt. Whilst, Indonesia white pepper was reported stable, averaging at USD 4,475 per Mt. Malaysia black and white pepper were reported with 1% deficit respectively as compared to the previous week, averaging at USD 2,459 per Mt for black pepper and USD 3,902 per Mt for white pepper. The decrease of Malaysia's pepper could be contributed to the weakening of Malaysian Ringgit against the US Dollar (MYR 4.11 @ USD 1), recording a 1% depreciation. Viet Nam black and white pepper were reported with an increase of 11% respectively as compared to the previous week, averaging at USD 2,697 per Mt for black pepper and USD 4,215 per Mt fo r white pepper. Sri Lanka black pepper was reported with an increase of 6% as compared to the previous week and was traded at an average of USD 2,924 per Mt.

INTERNATIONAL MARKET REPORT

International market was reported with a rather positive outlook as India black pepper was reported with the same increase of 1% when compared to the previous week, averaging at USD 4,989 per Mt. Indonesia black pepper was reported with an increase of 1% when compared to the previous week, averaging at USD 2,857 per Mt. Whilst, Indonesia white pepper was reported stable, averaging at USD 5,217 per Mt. Contrary to the local market, Malaysia black pepper was reported with an increase of 1% as compared to the previous week, averaging at USD 3,870 per Mt. Whilst, Malaysian white pepper was reported stable, averaging at USD 5,260 per Mt. Furthermore, Viet Nam black pepper 500 g/l, 550 g/l and Viet Nam white pepper were reported with an increase of 4%, 4% and 6% respectively as opposed to the previous week, averaging at USD 3,283 per Mt, USD 3,356 per Mt and USD 5,076 per Mt respectively.

US market as well as European markets were reported stable with a slight increasing trend. Muntok white pepper in US Market for CF March/April was reported in the range of USD 5.300 - 5,500 per Mt.