Pepper prices take nosedive

Ho Chi Minh City – Pepper growers around the country continue to see losses as pepper prices have dropped sharply to VND41,000 per kilogram, officials said.

A local farmer harvests pepper in this file photo. Pepper prices have dropped sharply to VND41,000 per kilogram - PHOTO: VNA

Speaking at a conference on the 2018-2019 pepper crop, held by the Vietnam Pepper Association (VPA) in HCMC on May 10, VPA Chairman Nguyen Nam Hai said that the price of pepper stood at VND55,000-VND60,000 per kilogram in 2018, but it has dropped further to VND41,000 per kilogram now, the local media reported.

Hai attributed the sharp fall in pepper prices to the oversupply in the domestic and international markets.

The world’s total volume of pepper amounted to some 556,000 tons in 2018, up 8.3% against the previous year. Vietnam topped the list in terms of pepper output, at 230,000 tons, accounting for 42% of the global market’s total pepper supply. Brazil came in second, with 70,200 tons of pepper.

The pepper supply in the global market has grown consistently by 8-10% since 2015, but demand for the product has increased by only 2%. The oversupply led to tumbling prices, causing heavy losses for pepper farming households.

At the conference, many experts and firms predicted that the global market will continue to see the pepper volume soar in the coming time, resulting in further declines in pepper prices.

According to the International Pepper Community, the world’s pepper volume is expected to amount to 602,000 tons this year, up 8.27%, with Brazil’s pepper output rising by 28% and that of Cambodia growing by 17%.

Vietnam was forecast to see a 9% increase in pepper output to 250,000 tons this year.

In the context of the continuing drop in pepper prices, some pepper firms suggested collaborating with each other and working with farmers to create a clean pepper manufacturing region to export the product at higher prices.

In addition, it is necessary for firms to enhance their capacity for processing pepper and keep a close watch on product quality and input materials. New technologies and diverse pepper-based products are also part of the solution to raise the pepper price.

Moreover, it is vital to boost promotion activities, expand the pepper importing markets and raise the pepper market share in Northeast Asia, the United States and the European Union, as well as to increase pepper consumption in the domestic market.