Russian version Ru  English version En
SUPPLIER OF QUALITY SPICES AND FOOD INGREDIENTS FROM FARM TO FAMILY
Tel./fax : +7 095 780-3676 
(Multi Lines) 
452-5454, 452-5876 
trade@ruspiceland.ru 
   
   
   
   
   
   
 
RuSpiceLand TV 1
 
   
   
   
Market report
Supply crunch to make pepper expensive by 27%

Due to a supply crunch in the global black pepper market, the commodity may see a stronger bullish phase in the coming days.

Vietnam, the world’s largest producer of the spice, has shipped 60 per cent of its total production till now. In May, it exported 60,000 tonnes and by June, exports are estimated to be around 70,000 tonnes.

Illegal exports to China are estimated to be around 10,000 tonnes. Apparently Vietnam is now having a stock of around 30,000 tonnes for the second half of the year.

The next harvesting season starts in Indonesia, followed by Brazil. In Indonesia, harvesting will begin by July and the crop size is estimated between 22,000 tonnes and 25,000 tonnes. In Brazil, where harvesting begins by September, production is estimated to be 30,000 tonnes.

According to the US market sources, the production in Brazil might fall due to old pepper vines and drought.

So the supply situation in the global pepper mart will be tight in the second half of the current year. Majority of the growers in Kerala are not releasing the stock as they expect a price tag of USD 4,50 a kg by September-October. The current local market price is at USD 3,30 a kg for un-garbled and USD 3,45 kg for garbled variety. As natural rubber and nutmeg have become much dearer, growers cultivating rubber, nutmeg and pepper are not in a hurry to release the stock. So the supply of pepper is rather very weak in the local market.

Vietnam is also not in a hurry to clear off the stock as there is uncertainty over their currency valuation. Now they offer the highest price tag of $3,550-3,600 a tonne and India quotes $3,500. Indonesia which is actively clearing off the old stock now offers $3,300-3,500 a tonne and indication price from Brazil is $3,450-3,500 a tonne. According to top exporters of the commodity, the stock position in Vietnam would be thin by August and there might be strong bullish trend in August-November as the next crop season in India begins by December.

Exporters also indicate that imports would be less in the coming months since prices in Vietnam are higher than the Indian counters. According to them the uncertainty over the currency valuation, especially the rupee-dollar parity and the concern over the value of the euro affects the Indian market badly.

The Euorpean buyers are not active in the global market although this is the best period to accumulate pepper. The economic turmoil in the European economies persuade them not to stock much volume. This is the only factor, that slowed down overseas demand and is likely to affect the prices. But the weak supply condition strongly indicates a bull run in the pepper mart by August

RuSpiceland
2010-06-10



 
 
96062 visitors