Pepper prices are continuously increasing and will continue to increase in the long term
According
to information from the Ministry of Industry and Trade, from the end of
April until now, pepper prices have continuously increased sharply and
adjusted prices daily. For example, around mid-May 2024, the pepper
price was 120,000 VND/kg. By the end of May, the pepper price increased
to 127,000 - 129,000 VND/kg. Updated on June 5, pepper price nearly
reached 150,000 VND/kg.
Vietnam's
pepper industry accounts for 40% of output and 60% of the world market
share. According to VPSA, the global pepper market size is worth about
5.4 billion USD and is forecast to achieve an average growth rate of
about 20% between 2024 and 2032.
Sharing
with the press, Mr. Hoang Phuoc Binh - Vice Chairman of Chu Se Pepper
Association (Gia Lai) said that this year's pepper output from Vietnam
and many major producing countries is forecast to decline, due to impact
of the El Nino phenomenon. Besides, the area under cultivation of this
agricultural product has decreased significantly. This is the basic
reason why pepper prices increased sharply.
In 2024, export pepper prices will increase due to reduced output and low inventory
For
more information about this story, Ms. Hoang Thi Lien - President of
the Vietnam Pepper and Spice Association (VPSA) said that pepper prices
have continuously plummeted for many years, causing many pepper growing
households to halve. area, many perennial gardens were cut down and
planted with durian and some other trees with higher economic value,
causing supply to decrease.
Furthermore,
in Vietnam, the amount of inventory transferred from last year to this
year is insignificant. Meanwhile, pepper demand is recovering strongly
from major markets such as Europe, the US and China. Supply is in short
supply, while demand is high. Those factors are the reasons why pepper
prices increased sharply.
Notably,
Mr. Binh informed that the pepper area is still decreasing due to aging
and people changing crops. While there is no new planting at this time,
it will still not be possible to increase output in the next 4 years.
Therefore, pepper will maintain a scarcity of supply.
"With
the current situation, global pepper production cannot meet consumer
demand, so pepper prices will still tend to increase in the next 3-5
years," Ms. Hoang Thi Lien added.
According
to industry experts, pepper prices may reach a new peak of 350,000 -
400,000 VND/kg. It doesn't stop there, it is very possible that pepper
is entering a new price increase cycle, normally this cycle will last
for 10 years and the price of 350,000 - 400,000 VND/kg is forecast for
the next 10 years. During this period, pepper prices will still have
fluctuations in adjustments.
Pepper exports are expected to reach billions of USD
In
the first 5 months of 2024, the United States continues to be Vietnam's
largest pepper export market reaching 30,466 tons, accounting for 26.6%
and increasing by 44.4% over the same period. Germany rose to become
Vietnam's second largest export market reaching 7,532 tons, accounting
for 6.6% and increasing 103.2%.
Some
markets have impressive increases in export volume such as: Italy
increased by 179.0%; Russia increased by 49.7%; Spain increased by
49.1%; Egypt increased by 39.0%…
According
to VPSA's preliminary statistics, in May 2024, Vietnam exported 31,357
tons of pepper of all kinds with an export turnover of 141 million USD,
the average export price of black pepper in May reached 4,542 USD /ton,
white pepper reached 6,106 USD/ton, an increase of 229 USD for black
pepper and 63 USD for white pepper compared to the previous month.
Accumulated
in the first 5 months of the year, Vietnam has exported 114,424 tons of
pepper of all kinds with a total export turnover of 493.1 million USD.
Compared to the same period in 2023, export volume decreased by 13.2%,
but export turnover increased by 20.6%. The average export price of
black pepper in 5 months reached 4,197 USD/ton, white pepper reached
5,804 USD/ton, an increase of 754 USD for black pepper and 849 USD for
white pepper respectively compared to the same period in 5 months of
2023.
Talking
to reporters, a representative of the Import-Export Department
(Ministry of Industry and Trade) predicted that the increase in domestic
pepper prices will push up export pepper prices and we can expect the
pepper industry to earn billions of dollars in export revenue. in this
year.
At
the same time, he added that in the world market, it is forecast that
pepper prices will continue to increase in the near future, but the
growth rate will slow down. In the domestic market, black pepper prices
have increased sharply due to limited supply, but people should not
massively expand planting areas but focus on investing and taking care
of intensive farming so that pepper plants can develop sustainably. and
stable.
As
for businesses, VPSA recommends that export businesses be careful in
purchasing and exporting activities to avoid risks similar to the recent
coffee or rice prices.
Export businesses still have concerns
In
fact, pepper prices increased sharply in the context of a falling USD
and a tense shipping market, causing significant difficulties for export
businesses in the past and in the future. In addition, many experts are
also concerned about the possibility that due to speculative
activities, traders and investors have gathered goods and created an
artificial scarcity, pushing up pepper prices.
Many
businesses share that pepper prices are double the same period last
year, and have reached the highest level in the past 8 years, causing
difficulties for export businesses, businesses cannot buy goods while
prices continue to rise. is pushed up. Many farmers are stockpiling and
waiting for prices to increase further. This is putting pressure on some
businesses to collect enough goods for their partners.
Regarding
this issue, Mr. Binh commented that pepper prices have increased
rapidly recently due to the impact of speculative factors. Currently,
world prices are increasing, domestic prices are lower than world
prices, so many small dealers are holding goods, pushing up prices.
The
Vietnam Pepper and Spice Association (VPSA) currently estimates that
Vietnam's pepper output in 2024 will only reach about 170,000 tons, down
10% compared to the previous year. This is also the lowest level in the
past 5 years. The reason is that many farmers cut down pepper trees
when prices fell 4 years ago (pepper price dropped to only 40,000
VND/kg) to plant more economically beneficial trees such as durian,
coffee...
Global
pepper production in 2024 is expected to reach about 465,000 tons, down
1.2% compared to last year. Meanwhile, global pepper consumption demand
is expected to reach 529,000 tons, exceeding production by 64,000 tons.
This caused inventories to continue to decline to 428,000 tons, the
lowest level in the past 6 years.
According to VTV.vn
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