Monthly Publication

During March 2013, the Price Index for black pepper decreased by 7.26 points and 3.69 pint for white pepper (Table 1). The composite price of black pepper decreased by 3.1% to USD 6,555 per mt from USD 6,764 in February 2013, while that of white pepper decreased by 1.7% from USD 9,207 per mt in February 2013 to USD 9,050 in March 2013 (Table2).

Table 1. IPC Price Index (Base Year: Average 2006 - 2010)

Note: The price index is calculated based on price developments in 2006-2010
Table 2: Composite Price of Black and White Pepper (US$/MT)

Black Pepper
In the first quarter, the market concentrated on the development in India and Vietnam, since these two main producing countries harvested their pepper in this period. During the month of March the market showed a mixed trend. In Sarawak and Sri Lanka pepper prices increased, while in India the price decreased. In Vietnam, Lampung and Brazil the prices were relatively stable during the month under review.

During March 2013 there was a change in the pepper market development. In India the market showed a declining trend. Pepper harvest in India taken place in early this year has pressed domestic market. Entering the month of March 2013 pepper price in India experienced a significant fall from INR 400/kg in February to Rs350/kg in the first week of March. Similarly for fob price also decreased significantly. The prices then relatively stable at the level of around INR 346 per kg till the end of the month. Although the price has fallen, when compared to price prevailed in other producing countries, the local price remained the highest. It is reported that the output from the recent harvest was not as good as estimated earlier and inventory in the internal market remained tight. Limited volume of transaction recorded in Indian Commodity Exchanges has also reflected this situation.

During March 2013, pepper harvest in Vietnam has started. Due to unfavorable weather condition the production of Vietnam is estimated to be lower than previous year-s harvest, but still the largest. Although the harvest has started, the market was not very hectic as producers were not interested to sell the material at reduced price. During March, domestic price of black pepper remained stable at around VND 120,000 (USD 5.75) per kg; but for fob, the price decreased by 2%. During January - March 2013 Vietnam is estimated to have exported around 39,000 mt of pepper valued at around USD 261 million as against 31,000 mt valued at USD 211 million achieved in the same period last year. The United States remained the biggest buyer followed by Germany, Singapore, and United Arab Emirates.

In Lampung, the local market was very quiet and prices were relatively stable throughout the month. Trading was very limited since material from last year harvest was exhausted. New material from this year harvest is only expected to come in the market by July 2013. It is estimated that production of black pepper in Lampung would be lower from last year crop, due to old pepper plant and disease infestation. Some rejuvenation have taken place during the past years is expected to yield in 2014/15. Up to February 2013, Lampung has shipped 3,340 mt of black pepper valued at USD 21 million compared to last year-s corresponding period exports, the export in the first two month was 21% lower. In March, pepper prices prevailed in Lampung was around IDR 55,000 per kg locally and USD 6,6,00 per mt for fob price.

In Sarawak local prices fluctuated at narrow range with a slight increasing trend. At the first week of March the Sarawak black pepper price increased from MYR 16.4 per kg to MYR 16.75. The price then increase further to close at MYR 17.0 per kg at the end of the month. Fob price increased by USD 100 per mt from USD 7,400 per mt in February 2013. In February 2013, Malaysia exported around 620 mt of pepper (515 mt of black and 105 mt of white pepper) as against 777 mt of export in February 2012. During January - February 2013 total export from Malaysia was 1,358 mt comprising of 1,134 mt of black and 224 mt of white pepper. During the last five months export of pepper from Malaysia experienced a continuous decrease from October 2012 (1,158 mt) to 620 mt in February 2013. The continuous decrease reflected that supply from Malaysia is currently limited. New material from this year harvest is only expected to come to the market by May/June.

In Brazil, the prices were relatively stable both local and fob price. During March 2013 average price of Brazilian black was around BRL 11.38 per kg locally and for fob price was USD 6,550 per mt. During the first two months of this year, Brazil has exported 4,702 mt valued at USD 29.4 million as against 4,222 mt worth USD 29.6 million in the same period last year, registering an increase of 11% in quantity with slight decrease in value by 1%. During the first two months the United States and Germany continued to be the most important destinations absorbing about 41% and 17% of pepper respectively from Brazil

In Sri Lanka, the average price at pepper growing areas increased from LKR.694/kg (USD 5.45) at beginning of the month to LKR 712 (USD 5.61) at the end of the month. Compared to the average price in the previous month, 3% increase was recorded.

Black pepper prices prevailed in local markets is shown in Table 3 and FOB prices in Table 4 below.

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

Table 4: FOB Prices of Black Pepper in USD per MT

White Pepper
Similar to black pepper, the market for white pepper also showed a mixed response during March 2013. In Bangka, price of white pepper decreased, while in Sarawak and Vietnam increased.

In Bangka, Indonesia, the local price for white pepper has experienced a declining trend from IDR 86,000 (USD 8.90) per kg in the mid of February 2013 to IDR 81,000 (USD 8.35) in the first week of March. Subsequently the price was relatively stable and close at IDR 82,000 (USD 8.43) per kg locally and USD 9,500 per mt fob.

In Sarawak, local prices increased gradually from MYR 25 (USD 8.06) per kg in February 2013 to MYR 26 (USD 8.39) in the fourth week of March 2013. On an average, the local price in March has increased by 3%. Fob price of Sarawak white pepper has also increased by 3%, from USD 9,400 per mt to USD 9,700 at the end of the month.

In Vietnam, local price of white pepper increased by 1% from VND 183,000 (USD 8.75) per kg in February to VND 185,000 (USD 8.85) in March 2013. Fob price of Vietnamese white pepper also increased by 1%.

White pepper prices prevailing in local markets are shown in Table 5 and FOB prices in Table 6.

Table 5: Local Prices of White Pepper in USD per MT

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