Monthly Publication

During April 2014, the Price Index for pepper increased significantly by 19.03 points for black and 24.49 points for white pepper (Table 1). The composite price of black pepper increased by 8.1% to USD 7,279 per mt from USD 6,731 in March 2014, while that of white pepper increased by 11.5% from USD 9,052 per mt in March 2014 to USD 10,096 in April 2014 (Table2).

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

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

In April 2014 the market was very hot. Pepper price increased at all producing countries. Sharp increase was recorded in Kochi. This was due to limited stock at domestic market of India coupled with the strong domestic and overseas demand. Vietnam, the largest producing countries was the only source to meet demands. Good harvest in Vietnam has completed and large quantity of pepper has entered the market. Development in this source has influenced global market direction.

In April 2014 market activities were concentrated in Vietnam. However, trading was relatively not brisk. Supported by good demand, pepper price in Vietnam has increased. During April 2014, producer-s price of black pepper prevailed in HCMC increased significantly by VND 17,500 per kg from VND 129,000 per kg in early April to VND 146,500 at the end of this month; while FOB price for black 550g/l increased by USD 550 per mt to USD 7,100 per mt. When compared to average price prevailed in the previous month (March 2014), local prices of black pepper increased by 11% and for FOB price increased by 7%.

In the case of white pepper, the local price of Vietnamese white in April 2014 also increased by VND 10,000 per kg to VND 197,500 per kg. When compared to average price in March 2014, the white pepper price increased by 12% locally and 14% FOB.

It was reported that output of this year harvest in Vietnam was good and export of pepper during the first four months has increased drastically. During January-April 2014, export of pepper from Vietnam is estimated to be around 68,000 mt as against 54,000 mt in the corresponding period of last year. During the last two years, Vietnam produced more than 120,000mt annually.

In India, the market was very tight, due to limited stocks, as output from this year harvest was also not good as last year. Given the situation of strong domestic demand, almost all material has been absorbed in the local market. To meet domestic and overseas demand India imported significant quantity from Vietnam. Due to this situation pepper price in Kochi has increased sharply from INR 520 per kg locally at the beginning of the month to INR 690 at the forth week of the month. In dollar terms, average price of Malabar black increased significantly by 20% in April when compared to average price in March 2014. FOB price in April 2014 has touched the record high at the level of USD 11,500 per mt in the forth week of the month.

Similar to this situation, the price of black pepper in Lampung also increased by IDR 8,000 per kg to IDR 84,000 at the second half of the month. The market was reportedly quiet in view of the limited stock at domestic market. Material at farm level from last year crop has been exhausted. New material is only expected to be available in the market by July 2014. Due to unfavorable weather during flowering season of pepper, particularly in North Lampung, production would be lower compared to last year harvest. Due to limited carry over from last year, export of black pepper during the first four months is estimated to be around 5,500 mt, almost same as the last year-s corresponding period-s export.

In Bangka, production of white pepper is expected to be better this year and the harvest may be from the beginning of July. White pepper price has increased by IDR 5,000 per kg to IDR 125,000 at the second week of the month. The price then maintained at the same level till the month end. Compared to average price in the previous month, the prices in April was higher. During the first four months, Indonesia is estimated to have shipped 3,800 mt of white pepper.

In Brazil, average price of pepper also increased. Throughout the month, local price of Brazilian black in Belem was reportedly stood at the level of BRL17 per kg. Compared to price prevailed in the previous month, the average price increased by 7%. FOB price of B1 increased from USD 7,650 per mt to USD 8,050 at the forth week of the month. On an average the price increased by 3%. During January - April 2014, Brazil has exported 10,791 mt valued at USD 80.9 million, registering an increase of 13% in volume and 33% in value.

In Sarawak local prices increased marginally in April from MYR 20 and MYR 29.9 per kg for black and white pepper respectively prevailed at the beginning of the month to MYR 20.75 and MYR 30.75 per kg respectively for black and white at the end of the month. FOB price also increased marginally by USD 50 per mt to USD 8,600 for black and USD 10,680 for white. During January - April 2014 Malaysia is estimated to have exported around 3,500 mt of pepper as against 3,387 mt in the same period last year.

During April 2014 pepper price at growing areas in Sri Lanka increased from LKR 878 per kg prevailed at the beginning of the month to LKR 928 at the end of the month. Compared to the average price in the previous month, an increase of 3% was recorded.

Overall, the market was hot during the month of April. The price prevailed in April increased at all origins. Production of pepper this year is estimated to be comparatively lower, particularly in India and Lampung. In view of limited material available in most of the producing countries and decreased production estimate this year, the price is expected to remain high during 2014. Export of pepper from January to April was higher from the corresponding period of the last year export, mainly due to increased export from Vietnam.

Black pepper prices prevailed in local markets are 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 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