Bountiful time for pepper producers

The heavy appreciation in the price of black and white pepper is likely to continue in world markets, thanks to a supply shortage in major producing countries.

The market will be a sellers’ paradise for the next six to eight weeks, according to indications from Vietnam, Indonesia and India. It is estimated that production in 2011 would be around 200,000 tonnes, about six per cent lower from 2010.

During the first nine months of this year, export from the six major producing countries of Brazil, India, Indonesia, Malaysia, Vietnam and Sri Lanka was around 188,000 tonnes. This is four per cent lower than that in the corresponding period last year, estimates the International Pepper Community (IPC).

In September, the price index of pepper had increased by 38.1 and 26.3 points for black and white pepper, respectively, says IPC. There has also been a significant rise over the past 12 months. Strong demand, coupled with the global short supply, has pushed the price.

In Vietnam, the world’s largest producer, the local and FOB (export) prices have risen by 19 and 20 per cent, respectively. Among the six major exporters, Vietnam’s contribution was 60 per cent.

An increase of nine per cent in prices has taken place in Sri Lanka. In Brazil and India, local prices have risen by five to six per cent, and FOB prices by 11 to 20 per cent.

Last month, the six main exporters together shipped around 23,200 tonnes, as against 19.860 tonnes in September last year.