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 PEPPER PRICES ARE FORECAST TO REMAIN HIGH

|March 11th, 2024

Pepper prices increased by more than 30% in less than 3 months and are forecast to continue to stay high thanks to the push from reduced supply and external factors.

In just 3 months (from December 2023), pepper prices have increased by more than 30%. As of the end of February, the price of black pepper increased by 10,000 - 11,000 VND/kg compared to the end of January to 91,000 - 94,000 VND/kg. The highest threshold recorded in March was 96,000 VND/kg.

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Pepper prices are forecast to remain high

According to some businesses and experts in the pepper industry, in recent times pepper prices in many countries such as Brazil and Indonesia have often been higher than Vietnam, and there was even a time when Indonesia had no pepper to export.

In fact, at this time, only Vietnam is harvesting a lot. World prices are higher than domestic prices, adding to the fear of shortages and price increases, so many businesses proactively increase purchases, pushing pepper prices up sharply.

Pepper prices are currently stable and may increase in the near future. Supply still cannot meet demand. However, for the pepper market, businesses should also pay attention to not simply assessing supply and demand, but also need to assess the geopolitical conflict of a region that affects the supply and demand of that region and the region. Nearby or not?

Currently, global pepper consumption demand is about 600,000 - 700,000 tons. This demand is met through imports and domestic cultivation. Asia consumes the most pepper in the world with 400,000 tons, of which half is imported and the other half is self-produced. America consumes 110,000 tons, of which 90,000 tons are imported from other countries, while Europe imports almost all.

According to the International Pepper Association (IPC), world pepper output will decrease by about 2% in 2024. Not out of the trend, Brazil's output will decrease more sharply due to issues related to climate change. Queen. Vietnam's pepper output may decrease to about 170,000 tons, but exports can still reach about 240,000 tons.

According to experts, in countries with large pepper production, Brazil has passed the harvest season, Vietnam is currently entering the harvest season, while the main season of Indonesia and Malaysia is in July every year. Supply from Indonesia, Brazil, Malaysia, and Cambodia is not enough to compensate for Vietnam's reduced export volume, which will push pepper prices up sharply right from the beginning of the season.

Meanwhile, Ms. Hoang Thi Lien - President of the Vietnam Pepper and Spice Association (VPSA) commented that the pressure of supply decline will have a positive impact on prices. This creates motivation for people to invest more in pepper gardens.

According to estimates by the General Department of Customs, in the first 2 months of 2024, Vietnam's pepper exports reached about 35 thousand tons, worth 143 million USD, down 12.3% in volume, but up 12.9% in value. prices compared to the same period in 2023; Vietnam's average export price of pepper is estimated to reach 4,041 USD/ton, up 28.7% over the same period in 2023.

The increase in raw pepper prices is putting pressure on export businesses as orders must be signed in advance. Many businesses also predict that 2024 will continue to be a year of fluctuations for the pepper market, pepper prices will increase.

According to congthuong.vn

 

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