Export of pepper increased sharply in value

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Export of pepper increased sharply in value

In April 2021, Vietnam's average export price of pepper reached $3,265/ton - the highest level since December 2018, an increase of 10.6% compared to March 2021 and an increase of 62.2 % compared to April 2020. The restructuring of supply and diversification of products have helped increase the export value of pepper.
According to the Vietnam Pepper Association (VPA), in early 2021, the main markets of Vietnamese pepper will gradually be less affected by the COVID-19 pandemic, so consumption will increase. These are the factors that help export pepper to increase sharply in value.

Currently, the EU, China, the United States, the United Kingdom, Japan, Russia, Thailand, South Korea, Mexico, and South Africa are the 10 largest pepper import markets in the world. In the EU, in 2020, Vietnam's pepper market share accounts for 27.84% of the total import value of this market, lower than 30.37% in 2019. Forecast in the short term, grain exports Vietnam's spending to the EU will face difficulties because the COVID-19 epidemic is still complicated. However, the promotion of vaccination against COVID-19 in the EU is a positive signal for pepper exports to this market. EVFTA is considered an opportunity to increase the value of pepper exports to the EU market.

The Import-Export Department (Ministry of Industry and Trade) quoted statistics from the General Department of Customs as saying that Vietnam's pepper exports in April 2021 reached 32.2 thousand tons, worth 105.22 million USD, an increase 2.6% in volume and up 13.5% in value compared to March 2021, down 10.3% in volume compared to April 2020 but up 45.5% in value. In the first 4 months of 2021, Vietnam's pepper exports reached approximately 93.6 thousand tons, worth 284.3 million USD, down 19.6% in volume, but up 14.5% in value compared to the first 4 months of 2021. same period in 2020.

In April 2021, Vietnam's average export price of pepper reached $3,265/ton - the highest level since December 2018, an increase of 10.6% compared to March 2021 and an increase of 62.2 % compared to April 2020. In the first 4 months of 2021, Vietnam's average export price of pepper reached 3,039 USD/ton, up 42.4% over the same period in 2020. In which, the average export price of pepper to some the market reached a high level, such as: Thailand reached 3,930 USD/ton; Germany reached 3,796 USD/ton; Netherlands reached 3,786 USD/ton.

In April 2021, Vietnam's pepper exports to a number of markets including the United States, India, the Netherlands, and Egypt decreased compared to April 2020, but exports to markets include: the United Arab Emirates. United Arab Emirates, Pakistan, Germany, UK, Korea, Philippines increased. In the first 4 months of 2021, Vietnam's pepper exports to most of the main markets decreased, but exports to the United Arab Emirates and the UK increased compared to the same period in 2020.

The report of the International Pepper Association (IPC) shows that the global supply of pepper is limited due to the reduced area, low yield due to unfavorable weather factors and poor preservation skills. According to IPC, global pepper production in 2021 is expected to reach 555,000 tons, down 21,000 tons compared to 2020.

Reduced supply has supported global pepper prices to rise in most producing countries. At the port in the city area. In Ho Chi Minh City of Vietnam, on May 17, 2021, the export price of black pepper 500g/l and 550g/l both increased by 1.4% compared to April 29, 2021, to $3,645/ton and 3,685 USD/ton. Export price of white pepper increased by 1.1% compared to April 29, 2021, to USD 5,389/ton. In Brazil, on May 17, 2021, the export price of black pepper increased by 1.3% compared to April 30, 2021, to USD 3,925/ton.

In China, one of the 10 largest pepper import markets in the world, in 2020, Vietnam's pepper market share accounted for 8.98% of China's total import value, higher than 6.95 % in 2019. Although China's pepper imports from Vietnam increased faster than the general import rate, the Vietnamese pepper industry has not yet exploited the Chinese export market well. The reason may be that China has a large import demand for white pepper, while Vietnam mainly produces black pepper.

It is forecasted that Vietnam's pepper exports to China will slow down in the short term. China still imports moderately after the "hot" increase in pepper prices in March 2021. In the long term, China is a large potential pepper export market that Vietnamese businesses need to exploit. In the context that the COVID-19 pandemic is still complicated, customs clearance activities are slow, the countries sharing the same border and land will promote their advantages.

Notably, in the first months of 2021, exports of black pepper and white pepper decreased, but exports of ground black pepper and ground white pepper increased. Specifically, the export of ground black pepper reached 7.6 thousand tons, worth $25.58 million in the first quarter of 2021, up 21.6% in volume and 40.2% in value over the same period last year. 2020; export of ground white pepper increased by 73.8% in volume and 114.5 % in value.

Thus, it can be seen that Vietnam's pepper industry has had a shift in the structure of export categories, reducing export volume but paying attention to improving product quality. Businesses that sign contracts to buy organically grown pepper with quality assurance are priced higher than the market by 2,000 - 3,000 VND/kg.

It is forecasted that global pepper prices will continue to increase in the near future, but the increase is not large. According to the Import-Export Department, in the context of fluctuating pepper prices, Vietnam's pepper industry needs to continue to shift the supply structure. Organic pepper is one of the sustainable ways to increase product value compared to traditional grown pepper.

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