Pepper Market Review Week 42 2020
Black and White Pepper Prices
Continue to remain firm as Chinese traders were back after Golden Week Holidays which forced local shorts to follow the market and cover their pending commitments to Overseas Customers.The exporters are feeling the pain of mounting losses accumulating since end of March paying 25% more on raw materials and double the freight for cargoes sold last year and early this year especially to North America. The trade is currently facing the threat from a Vietnamese billionaire who have set his eyes on Pepper after successfully taking over the raw cashew and feed ingredients business under control in 2019 as well as current year in Vietnam.The billionaire have Started focusing his attention on pepper and slowly buying and holding with a long term stocking plan as he feels markets have already seen the bottom and no more down side and the typhoon and flooding in central highlands in the last two weeks is very conducive for his stocking plan as the yield for 2021 will be highly impacted with the farmers neglecting the pepper vines as it’s not financially viable any more. Local prices in Vietnam Dongs continued to remain in the 51000 VND per kilo throughput the week with swings of a meager 500 Dongs per kilo .The billionaire and Chinese traders will give the shorts sleepless nights in the last quarter also as no respite in pricing is seen locally and we won’t be surprised if the prices move up another 10% before the end of the year with already 230,000 mts pepper exported till 15 th of October of course with imports from Brazil,Cambodia and Indonesia to the tune of 25000 till mid October 2020
Brazil prices for B1 remained stable at 2350 FOB Vila do Conde and Indonesian Asta prices vainly at 2400 FOB Panjang for nearby shipments and Indian MG-1 still in the 4850-4900 FOB Cochin thanks to the huge domestic demand .Sarawak yellow label was quoted USD 2650-2750 FOB by local exporters where as Pepper Marketing Board Malayasia was offering firm 3375 FOB to the surprise of the trade.
Keep covered till the end of the year and make use of the lower offers from reliable exporters who are struggling to maintain the top poisons in the export Statistics.