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Pepper market situation in 2016 will depend largely on developments in production during the year. In the short term, the market may be slightly affected by the situation of harvesting season in India and Vietnam. Global pepper production in 2016 is estimated to be more or less same with the global supply in 2015. Significant fall of production is anticipated in India and Indonesia, which would be expected to be compensated by increased production in Vietnam and Sri Lanka. Although Pepper price has decreased during beginning of the year, taking into account the increased consumption and demand situations, price for the whole year is expected to remain high but would not fall down drastically.

During January 2016, the Price Index has decreased by 3.99 and 1.614 points for black and white pepper respectively (Table 1). The composite price of black pepper has decreased by 3.1% to US$ 9,189 per Mt from US$ 9,486 per Mt in December 2015, while that of white pepper decreased by 1.2% from US$ 13,337 per Mt in December 2015 to US$ 13,170 in January 2016 (Table2). The decrease of the composite price index was mainly influenced by price development in Vietnam and India, the largest supplier; while prices at other origins were relatively stable during January 2016.

It is for information that, for 2016 the price index is re-calculated based on average price of the last ten years 2006-2015 as base year, since prices during this period increased continuously from the rock bottom level in early 2006 to the highest in 2015.

Table1. IPC Price Index (Base Year: Average 2006 - 2015)

Table 2: Composite Price of Black and White Pepper (US$/Mt.)

Pepper prices prevailing in local markets are shown in Table 3 and 4, while for FOB prices are in Table 5 and 6.In the month of January 2016 Pepper market generally remained steady, but showed a mixed response at the origins. Price of black Pepper in India and Vietnam over the month of January has seen a fall of around 6.5% and 7.65% respectively. In Malaysia, Indonesia and Sri-Lanka has also seen a minimal black Pepper price drop. In Vietnam, white Pepper price has significantly fallen by 14% where as in Malaysia and Indonesia white Pepper price is almost stable. FOB price of black Pepper in India and Vietnam has decreased by 7% and 4% respectively. Whereas FOB black Pepper price in Indonesia and Malaysia is almost stable during the month. The FOB price of white Pepper in Indonesia, Malaysia and Vietnam is seen almost stable and not much volatility in price is noticed.

Table 3: Local Price of Black Pepper in USD per MT

Table 4: Local Prices of White Pepper in USD per MT

Table 5: FOB Prices of Black Pepper in USD per MT

Table 6: FOB Price of White Pepper in USD per MT