The market has halted its upward trend and will experience unusual fluctuations; Vietnamese consumers are facing increasing competition.

Today's pepper prices in the provinces of Dong Nai (141,000 VND/kg); Dak Lak (142,000 VND/kg); Dak Nong (142,000 VND/kg); Ba Ria - Vung Tau (141,500 VND/kg) and Binh Phuoc (141,000 VND/kg).

Thus, after three days of increases, domestic pepper prices remained stable today in key producing regions. The highest price for pepper was 142,000 VND/kg.

On the morning of July 31st, in Ho Chi Minh City, the Vietnam Pepper and Spice Association (VPSA) held a conference to review the first six months of the year and plan tasks for the remaining half.

At the conference, Mr. Le Viet Anh, General Secretary of VPSA, commented that pepper prices will experience unusual fluctuations, such as the situation on June 11th when the price surged by 20,000 VND/kg in the morning but then dropped sharply again in the afternoon.

He analyzed that pepper is increasingly facing competition from durian and coffee. New planting areas exist but are not large, mainly intercropping pepper with coffee at a ratio of 6:2. The yield for the next season may be equivalent to or slightly higher than in 2024. The amount of unsold pepper in farmers is no longer significant, and while pest and disease problems still exist, they are not substantial.

According to VPSA, Brazil currently has 3 sterilized pepper processing plants, with 2 more under construction and expected to be completed in 2025. In the future, Brazilian pepper will be more competitive with Vietnamese pepper, thus reducing import supply. Therefore, Vietnamese businesses need to proactively secure their own raw material sources.

VPSA forecasts that Vietnam's domestic pepper production in the next crop season may remain low. The amount of stock held by farmers is not significant, and while pest and disease problems still exist, they are not substantial. Meanwhile, global pepper production in 2024 is projected to reach 465,000 tons, while consumption demand is expected to reach 529,000 tons.

VPSA estimates that Vietnam's pepper production in 2024 will only reach about 170,000 tons, a 10% decrease compared to the previous year, which is also the lowest level in the last 5 years.

Meanwhile, data shows that by the end of July 2024, Vietnam had exported 164,357 tons, earning $764.2 million. Compared to the same period in 2023, export volume decreased by 2.2%, but export value increased by 40.8%.

There are still 7-8 months until the next pepper harvest (expected after the Lunar New Year, from February 2025), while the amount of stock remaining with farmers, dealers, and businesses is not much.

Domestic pepper supply is under pressure to decrease, coupled with forecasts of reduced pepper production in other countries such as Brazil and Indonesia this year. This will continue to put pressure on pepper prices in the remaining months of the year.

On the world market, at the close of the most recent trading session, the International Pepper Community (IPC) listed the price of Lampung black pepper (Indonesia) at US$7,320/ton, up 0.23%; the price of Brazilian ASTA 570 black pepper at US$6,100/ton, down 4.92%; and the price of Kuching black pepper (Malaysia) ASTA at US$8,500/ton.

Muntok white pepper is priced at US$8,970/ton, up 0.25%; Malaysian ASTA white pepper is priced at US$10,400/ton.

Vietnamese black pepper is trading at US$5,800/ton for the 500 g/l grade; US$6,200/ton for the 550 g/l grade; and white pepper at US$8,500/ton. IPC continues to increase pepper prices in Indonesia, while prices have fallen sharply in Brazil.