Monthly Publication

PRICE HISTORY

Despite being one of the most challenging year, price index of pepper in the closing month of 2020 was reported with a positive outlook. The price index of black pepper for December 2020 was reported at 40.13 points, recording an increase of 2.9% as compared to November 2020 and 19% increase as compared to December 2019. Continuing the same trend, Price index of white pepper for December 2020 was reported with 2.1% increase when compared with November 2020 at 42.87 points (Table 1). However, when compared with December 2019, the price index of white pepper recorded a 24% increase.

Year 2020 saw price index of pepper with a rather positive outlook with the annual average price index of 2020 for black pepper was reported at 34.21 points, recording an increase of 2% as compared with the average of 2019. When comparing between January and December 2020, the price index of black pepper recorded an increase by 19%. The annual average price index of 2020 for white pepper was reported at 36.51 points, recording a slight increase of 1% as compared with the average of 2019. Comparing between January and December of 2020, the price index of white pepper recorded an increase by 23%.

Align with the price index, the composite prices at the end of 2020 were reported with a positive outlook. The composite price of black pepper was reported at USD 2,985 per Mt (Table 2), recording an increase by USD 83 per Mt as compared to November 2020. In addition, the average composite price of black pepper for the entire 2020 was reported at USD 2,545 per Mt, recording a slight increase of 1% as compared to the average composite price of black pepper in 2019. Following the positive trend, the composite price of white pepper was reported at USD 4,436 per Mt recording and increase by USD 89 per Mt as compared to November 2020. Whilst, the average composite price of white pepper for the whole year of 2020 was reported at USD 3,778 per Mt, recording a slight increase of 1% as compared with the average composite price of white pepper in 2019.

Pepper prices in the last month of 2020, showed a rather positive response with only Sri Lanka origin was reported with a decrease. The farm gate price of black pepper in India was reported with an increase of 3% as opposed to November, averaging at USD 4,528 per Mt (Table 3). In the local currency farm gate price of India (Malabar black pepper) was reported at an average of INR 333 per Kg increasing from INR 327 per Kg in the previous month.

The farm gate price of black pepper in Indonesia (Lampung black pepper) was reported with an increase of 6% to an average of USD 2,247 per Mt as opposed to November 2020. The increase was contributed to the lack of stock in local market. The price of Indonesia black pepper in local currency increased to an average of IDR 32,337 per Kg from IDR 30,190 per Kg in November.

The farm gate price of Malaysia's black pepper for the 12th month of 2020 was reported with an increase of 6% when compared to the previous month averaging at USD 2,273 per Mt. In local currency, the price of Malaysia black pepper increased to an average of MYR 9.2 per Kg from MYR 8.8 per Kg in the previous month.

Furthermore, farm gate price of black pepper in Viet Nam was reported with a slight increase of 1% as compared to the previous month, averaging at USD 2,335 per Mt. In local currency, the price of Viet Nam black pepper slightly decreased to an average of VND 55,174 per Kg or a decrease of VND 231 per Kg when compared to the previous month.

The farm gate price of Sri Lankan black pepper was reported with 1% deficit as opposed to November 2020 and was reported at an average of USD 2,930 per Mt. Sri Lanka black pepper in local currency decreased to an average of LKR 544.85 per Kg from LKR 549.47 per Kg in November.

FOB price of black pepper for December 2020 showed a rather positive outlook with only Malaysia origin was reported unchanged. The FOB price of Malabar black pepper from India was reported with an increase of 3% when compared to the previous month, averaging at USD 4,799 per Mt (Table 4). Furthermore, the FOB price of Indonesian black pepper was reported with an increase of 6% as opposed to November, averaging at USD 2,732 per Mt. FOB price of Malaysian black pepper was reported stable and unchanged. FOB price of Viet Nam black pepper 500 g/l and 550 g/l were reported with an increase of 3% respectively as compared to the previous month, averaging at USD 2,833 per Mt and USD 2,914 per Mt respectively.

Farm gate prices of white pepper in December 2020 also showed a positive outlook (Table 5). Indonesia Muntok white pepper was reported with an increase of 5% as compared to the previous month to an average of USD 4,022 per Mt. Similar to Lampung black pepper, the increase of Indonesia white pepper was also contributed to the depleted stock in local market. In local currency, the price of Muntok white pepper was reported at an average of IDR 57,158 per Kg from IDR 54,571 per Kg in November. Farm gate price of Malaysia white pepper was reported with an increase of 4% as opposed to November at an average of USD 3,747 per Mt. Furthermore, Viet Nam white pepper was also reported with an increase of 4% when compared to the previous month, averaging at USD 3,341 per Mt. In local currency, the price of Viet Nam white pepper was reported at an average of VND 78,152 per Kg, an increase of VND 1,652 per Kg when compared to the previous month. China white pepper was reported with an increase of 6% as compared to November and was traded at an average of USD 5,055 per Mt in domestic market.

FOB price of white pepper showed a rather positive outlook with only Malaysia origin was reported unchanged. FOB price of Indonesia white pepper for December 2020 was reported with an increase of 5% when compared to the previous month, averaging at USD 4,716 per Mt. FOB price of Malaysia white pepper was reported stable and unchanged. Furthermore, FOB price of Viet Nam white pepper was reported with an increase of 2% when compared to the previous month at an average of USD 4,403 per Mt. China white pepper was reported with an increase of 6% when compared to November and was traded at an average of USD 5,255 per Mt internationally (Table 6).

Entering the 12th month of global pandemic, FOB price of peppers in comparison between December 2019 and December 2020 fluctuated with an increasing trend. India black pepper in December 2020 was reported with 3% deficit as compared to the same period in 2019 at an average of USD 4,807 per Mt. Furthermore, Indonesia black and white pepper were reported with an increase of 29% and 31% respectively as compared to December 2019, averaging at USD 2,773 per Mt for black pepper and USD 4,730 per Mt for white pepper. Malaysia black pepper was reported stable averaging at USD 3,675 per Mt. Whilst, Malaysia white pepper was reported with 7% deficit as compared to the same period in 2019 to an average of USD 4,900 per Mt. Furthermore, Viet Nam black pepper 500 g/l, 550 g/l and Viet Nam white pepper were reported with an increase of 22%, 22% and 27% respectively as opposed to the same period in 2019 to an average of USD 2,838 per Mt, USD 2,919 per Mt and USD 4,408 per Mt respectively. China white pepper was reported with an increase of 16% when compared to December 2019 and was traded at an average of USD 5,270 per Mt (Table 7).

HIGHLIGHT ON CHINA

Production and Productivity

China is known as white pepper producing country which mostly produced in Hainan province (known as Hainan white pepper) with four major pepper production cities being Haikou, Wenchang, Qionghai and Wanning.

During 2009 to 2019 the area under pepper cultivation in China had shown an increasing trend with only 2011 was reported with a decrease as compared to the previous year. As it recorded a decrease by 5% to 16,568 Ha in 2011. As from 2012, the area under pepper cultivation in China was reported with an increasing trend to 2019. In 2019, China planted pepper on 21,000 Ha of area, recording an increase of 25% over the course of 11 years (Table 8). In addition, the area under pepper cultivation for 2020 was estimated to be stable and unchanged.

Pepper production of China had fluctuated with an increasing trend since 2009. Pepper production of China was reported to have recorded an increase of 40% in the past 11 years as it was reported to have produced a total of 32,000 Mt in 2019 which 6% or 2,000 Mt of it comprised of black pepper and 94% or 30,000 Mt of it comprised of white pepper. The highest production of China pepper in the past 11 years was reported in 2018 with 35,000 Mt whilst the lowest occurred in 2009 with 22,800 Mt. The production of China pepper for 2020 was estimated with an increase of 3% when compared to 2019 totaling at 33,000 Mt which 6% or 2,000 Mt of it comprised of black pepper and 94% or 31,000 Mt of it comprised of white pepper.

Pepper productivity in China in the past 11 years fluctuated with a positive trend (Chart 1). From 2009 until 2019 pepper productivity in China had been reported with an increase by 12% totaling at 1,524 Kg per Ha in 2019. The highest pepper productivity in China in the past 11 years was reported in 2018 with 1,750 Kg per Ha. In 2020, pepper productivity in China was estimated to increase by 3% as compared with the previous year to a total of 1,571 Kg per Ha.

Pepper Export from China

Since 2009 until 2019 there had been a 29% (Table 9) increase in term of quantities of pepper exported by China. The highest quantity of pepper export from China was reported during 2010 which amounted to 4,569 Mt whilst the lowest occurred in 2014 with only 1,041 Mt. In 2019, China was reported to have exported a total of 2,684 Mt of pepper, recording an increase of 6% as compared to 2018. As of July 2020, China exported a total of 1,207 Mt which comprised of 520 Mt of whole pepper and 687 Mt of ground pepper.

The quantity of pepper exports from China had reportedly fluctuated from January 2019 up to July 2020. The total export of pepper by China in 2019 was reported at 2,684 Mt with total value as high as USD 14.9 Million. The average pepper export from China in 2019 was reported to be 224 Mt per month with the highest reported in August which reached 526 Mt whilst the lowest was reported in July with only 123 Mt (Table 10). Furthermore, the total pepper export from China as of July 2020 was reported to be 1,207 Mt with total value of USD 6.4 Million, recording an increase of 12% in terms of quantity of pepper exported by China when compared to the same period in 2019. In the first 2 months of 2020, Business in China was reported to be inactive due to the global pandemic that emerged at the end of 2019.

https://www.cnbc.com/2020/03/07/coronavirus-china-jan-feb-2020-trade-data-reflects-outbreaks-impact.html

Pepper from China is exported to various countries around the world (Table 11). As of July 2020, the top 10 country of destinations for China pepper were reported to be Romania with 336 Mt (Contributed to 28% of the total China pepper export as of July 2020), Hong Kong with 170 Mt (14%), Germany with 150 Mt (12%), United States of America with 113 Mt (9%), Taiwan with 85 Mt (7%), United Kingdom with 77 Mt (6%), North Korea with 51 Mt (4%), Viet Nam with 40 Mt (3%), Australia with 34 Mt (2.8%) and Peru with 25 Mt (2%).

Pepper Import by China

Although China is one of pepper producing country, China's pepper production is unable to meet the domestic consumption which resulted to the import of pepper by China from various pepper producing countries.

In the first 2 months of 2020, Business in China was reported to be inactive due to the global pandemic that emerged at the end of 2019. As of July 2020, China imported a total of 9,519 Mt which comprised of 9,167 Mt of whole pepper and 352 Mt of ground pepper (Table 12).

Acquired from China counterpart data, during January-July 2020 China was reported to have imported a total of 42,997 Mt. Thus, making China the second largest pepper importer in the world after United States of America.

The top five countries of origins of China's pepper as of July 2020 were reported to be Indonesia with 4,664 Mt (Contributed to 49% of the total China pepper import as of July 2020), Viet Nam with 3,790 Mt (40%), Malaysia with 676 Mt (7%), Brazil with 252 Mt (3%) and India with 56 Mt (1%) (Table 13).

Acquired from China counterpart data, during January-July 2020 China was reported to have imported a total of 42,997 Mt with most of its pepper were reported to come from Viet Nam with 37,269 Mt.

Pepper Price

The FOB price of white pepper in China was reported to fluctuate with a decreasing trend during January 2019 up to December 2020 which could be attributed to the world supply of pepper significantly exceeded the global demand as well as the development of the global pandemic of Corona Virus.

In 2019, the average FOB price of China white pepper was reported at USD 4,813 per Mt, the highest FOB price of China white pepper was reported in February with an average of USD 5,083 per Mt whilst the lowest occurred in April with USD 4,030 per Mt.

In 2020, the average FOB price of China white pepper was reported at USD 4,527 per Mt. Thus, recording a decrease by 6% when compared to 2019. The highest FOB price of China white pepper in 2020 was reported in December with an average of USD 5,270 per Mt, recording an increase by 16% as compared to the same period in 2019. Whilst, the lowest occurred in August with USD 4,285 per Mt, recording a deficit by 15% as compared to the same period in 2019 (Table 14).

Source:
• Brazil, Unofficial source (Coreimex, CSG Trade)
• India: AISEF, NCDEX, Indian Chamber of Commerce & Industry
• Indonesia: Unofficial source
• Sri Lanka: Sri Lankan Pepper Board
• Sri Lanka: Department of Export Agriculture
• Viet Nam : Viet Nam Pepper Association, HCMC
• China: Hainan Pepper Association, China Spice Association
• International Trade Centre (ITC) - Geneva

Note: Some of the data in this publication are from the IPC database. The data are obtained from official reports and correspondence between the IPC and have been processed based on statistical norms that can be accounted for.