Monthly Publication

In September the market was quiet in most producing countries. More active trading was taking place in Brazil in view of the harvest was on the up swing trend. Some activity was also reported in Viet Nam following good harvest resulted this year. Except in Sarawak, pepper price at most origin has shown a decreasing trend during the month.

Pepper price index has shown a declining trend. Price index of black pepper decreased by 3.0 points and decreased by 2.1 points for white pepper (Table 1). The composite price of black pepper decreased by 4.7% to US$ 4,555 per Mt from US$ 4,780 in August 2017 and composite price of white pepper also decreased by 3.1% from US$ 6,751 per Mt in August 2017 to US$ 6,359 in September 2017 (Table 2).

During September 2017, market watched on the development of pepper harvest in Para state, Brazil which was on the full swing and anticipated to be better than in 2016. In 2016 total production of pepper in Brazil was reportedly at the level of 42,000 Mt. Around 30-40% was produced in Espirito Santo, where the harvest takes place in January - March and major portion around 60-70% was sourced from Para state during August-October. During 2016 Brazil has exported 31,100 Mt of pepper. As a result of expansion and intensive cultivation which was encouraged by good price in the last few years, the harvest in 2017 was reported to increase significantly. This was reflected by significant increase in export realized in the first nine month of 2017. During January - September Brazil exported 37,300Mt valued at US$ 192 million as against 19,700 Mt worth US$ 166 million in the same period last year. During September 2017 pepper price in Brazil prevailed at lower level. Abandoned supply situation was the main reason for this. Fob price of Asta black ruled at the level of US$ 4,200 per Mt throughout September 2017.

In Viet Nam the market was not brisk during the month as major portion of this year harvest has sold out. Limited row materials were available at producers and local traders. But they were not interested to release at lower price. During September local price of pepper in Viet Nam was on average at the level of VND 86,500 and VND 127,000 per Kg for black and white pepper respectively. It has decreased from VND 92,000 and VND 127,500 per Kg respectively for black and white pepper prevailed in August 2017. FOB price decreased by 6% for black and 4% for white pepper to US$ 4,560 and US$ 6,530 per Mt in September 2017. During January - September Viet Nam has exported 181,000 Mt of pepper valued at US$ 966 million. When compared to export in the same period last year an increase of 23% in quantity was recorded. In terms of value however, it has decreased by 19%.

In Lampung, the market was reported quiet. Low prevailing price was the main reason for the situation, farmers and local traders hold on limited material to stock, expecting to have better price. As reported earlier, production of black pepper in Lampung decreased significantly this year. During September local price of pepper in Lampung decreased from IDR 54,000 per Kg in August 2017 to IDR 52,500 per Kg in September. During January - July 2017, Indonesia has exported 13,000 Mt of black pepper, as against 10,500 Mt exported in the same period last year. Good export in the first half of the year was supported by sufficient stocks carried from previous year. In the second half of the year the export might be not as good as last year.

In respect of white pepper in Bangka, the main source of white pepper in Indonesia, production in this origin also decreased due to prolonged wet weather. Affected by global market sentiment, pepper prices in Bangka also decreased. It was recorded local price in the source decreased from IDR 82,000 per Kg in August to IDR 75,000 per Kg in September. Other than Bangka, Kalimantan and Sulawesi province also produce white pepper. Major portion of white pepper from this region is traded locally for domestic consumption. It was reported, white pepper from Sulawesi branded as Soroako white pepperhas also traded in the USA. During January - July 2017 export of white pepper touched 8,000 Mt, an increase of 1,000 Mt from 7,000 Mt over the same period last year.

In Kochi, India, local price of Malabar black decreased from INR 480 per Kg in August to INR 447 per Kg in September, recording a decrease by 7% Fob price of Malabar Garbled also decreased. Production of pepper in India during 2017 is reported better. However, due to strong internal demand, export increase of pepper from India is estimated to be marginal, even decrease this year as indicated by export performance achieved during January - June this year. It was reported that India exported only 3,300 Mt of whole black pepper in the first six months of 2017 as against 4,300 Mt in the same period, recording a decrease of 1,000 Mt. Together with other kinds of pepper such as white pepper, ground pepper and green pepper, a volume of 7,000 Mt might have been shipped from India in the first half of the year.

In Sri Lanka, price decreased in September. This may be influenced by market situation in Viet Nam and India, whereas Sri Lanka imported significant quantity of pepper from Viet Nam and re-exported to India for its domestic consumption including industrial uses. In addition to the above, an estimate good harvest this year has also contributed to the decrease in price.

In Sarawak, price of pepper showed a different direction in September 2017. During the month local price of Sarawak black pepper increased by 15% and 9% for white pepper. Volume of trade in this source however limited hence, the increase is not influencing global market direction.

Black pepper prices prevailed in the local markets are shown in Table 3 and FOB prices in Table 4; while for white pepper are shown in Table 5 and 6.