Black pepper prices spike, likely to rise further

Shrinking  carryover stock in the Vietnam market ,  drying up of imports, hoarding and anticipated shortage in the current harvest due to the El Nino impact, have all pushed up black pepper prices in the country past  95000 Vietnam Dongs per kg after a gap of several years.

The current year has seen the prices of several spices such as chilli, cumin, ginger and turmeric rally. Black pepper is the addition to the list. Black pepper prices have remained between US$ 1850 pmt and US$ 3000 for  some years now. Last year it spiked to over US $ 500 per mt in just two weeks at peak of harvest and this year we have already seen another US$ 500 pmt at beginning of harvest . This week, the price has started  climbing again to the next target level of 106000 Vietnam Dong per Kilo .

Pepper output in Vietnam this year, at about 164,000 tonnes, is said to be very abnormal normal though a section puts their numbers at 180,000 mt and another 157000 mt .The production in Vietnam  has been on a declining trend  in the last few years . but global  consumption has been rising annually steadily at 2.5 %  and  many farmers shifting to Avocado and Durian which is more remunerative. Coffee Prices are at historically highs farmers are flushed with money and they expect the same rally in pepper this year 

As prices started to rise a few weeks ago, growers began to hold on to the stock, pushing the rates up further. Coverage for Quarter 2 and 3 is expected soon which will see another rally in pepper prices this year is what we foresee .