Pepper price increase is a great opportunity for export companies

DNHN - Currently, pepper prices on the international market have risen sharply, creating a significant opportunity for export companies. This increase has changed the competitive landscape and spurred the development of the pepper export industry.

With economic development, the demand for pepper from emerging markets such as China, India, and Southeast Asian countries has increased significantly
With economic development, the demand for pepper from emerging markets such as China, India, and Southeast Asian countries has increased significantly.

One of the main factors leading to the increase in pepper prices is the impact of weather. Unusual rains, droughts, and climate change have negatively affected pepper yield and quality worldwide. The reduction in pepper production and quality has led to a scarcity and price increase of this product in the international market. This creates an opportunity for pepper export companies, especially those countries capable of producing high-quality pepper.

With economic development, the demand for pepper from emerging markets such as China, India, and Southeast Asian countries has increased significantly. The rise in income and the trend of using pepper in local cuisine have created a new opportunity for pepper export companies. Companies can take advantage of this opportunity to expand their export markets and increase sales.

The diversity in pepper products also plays a crucial role in increasing pepper prices and opportunities for export companies. Customers are increasingly concerned about the quality and added value of the products. Export companies can leverage this diversity to offer premium pepper lines, organic pepper, or pepper meeting special quality standards. This helps increase the product's value and expand the potential customer base.

The strength of the USD also has a significant impact on pepper prices in the international market. A stronger USD reduces the value of other currencies and creates added value for export products. This benefits pepper export companies as pepper prices rise.

"Vietnamese pepper, with top quality, is gaining favor in the international market.".

In the first half of 2024, domestic and export pepper prices in Vietnam have seen a strong increase, reaching nearly 153,000 VND/kg, double that of the same period last year. On the international market, the export price of black pepper reached over 4,300 USD/ton and white pepper nearly 6,000 USD/ton, an increase of about 1,000 USD per ton compared to 2023. Despite the high prices, many countries still increase imports of Vietnamese pepper, especially the US, Germany, India, and UAE.

According to information from the Vietnam Pepper and Spice Association (VPSA), the average export price of black pepper in the first six months of 2024 was 4,365 USD/ton and white pepper reached 5,983 USD/ton, an increase of 922 USD and 1,028 USD respectively compared to the same period in 2023.

In Vietnam, pepper prices recorded on July 15 ranged from 150,000 VND to 151,000 VND/kg in the Southeast and Central Highlands provinces. The domestic pepper market has recently experienced strong fluctuations, significantly affecting the profits of producers.

The main reason for the pepper price increase is that Vietnam harvests earlier than competitors like Brazil and India, along with high pepper quality and the impact of the El Niño phenomenon leading to reduced supply.

El Niño and adverse weather conditions have reduced pepper production in major countries like Vietnam, Brazil, and India, leading to a supply shortage and pushing pepper prices up.

According to Ms. Hoang Thi Lien, VPSA President, inventories in major producing countries are decreasing due to increased consumption demand and adverse weather impacts.

"Vietnamese pepper, with top quality, is gaining favor in the international market. With an early harvest and quality products, Vietnamese pepper is asserting its position in meeting market demand, especially in the context of a sharp supply reduction," said Ms. Lien.

Meanwhile, according to the Vietnam Pepper and Spice Association (VPSA), by June 2024, the US was the largest import market with 37,435 tons, up 44.6% compared to the same period last year and accounting for 26.3% of the market share. Germany ranked second with 9,526 tons, up nearly 107%, followed by India with 8,173 tons, up 46%. Importers from the UAE also purchased 8,388 tons, an increase of more than 15% compared to the same period in 2023.

In the first six months of 2024, Vietnam's pepper export volume reached 142,586 tons, up 30.5% compared to the same period, with black pepper accounting for over 88% of total export volume, the rest being white pepper.

On the import side, Vietnam imported a total of 18,002 tons of various types of pepper in the first six months of 2024, including 16,357 tons of black pepper and 1,645 tons of white pepper.

The total import value of pepper reached 69.6 million USD, up 18.9% compared to the same period last year. Brazil, Cambodia, and Indonesia are the three main countries supplying pepper to Vietnam.

Despite the reduction in Vietnam's pepper export volume, the total export value still increased significantly in the first half of 2024 due to the continuous rise in product prices.

Nhat Binh

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