The past year of 2021 is considered a difficult year for the economy in recent times when the covid-19 pandemic has affected many countries around the world, especially Southeast Asian countries and Vietnam was not exempt. However, the pepper industry has created remarkable impressions in 2021, and this year might be considered a resurrection year for the pepper industry.
Vietnamese pepper sector led the growth in the Agriculture, Forestry, and Fisheries industry.
The high price of pepper has increased its export value in recent times, despite the fact that output has reduced compared to the same period last year.
According to data from the General Department of Customs, in the first 11 months of 2021, Export pepper output was 245,975 tons, down 7% in volume but the value reached 867.2 million USD, up 43.8% equivalent to an increase of USD 264 million, this was attributed to a 54.6 % rise in the average export price, which leads to a decrease in output but a significant increase in value.
According to the Vietnam Pepper Association (VPA), the total amount of Vietnamese pepper exported in 2021 is 260,000 thousand tons, down 9% in output, with the value reaching 950 million USD, a 43.8 % increase in turnover over 2020.
Once again, Vietnamese pepper has continued to affirm its position in the global market when pepper exports account for 60% of the global consumer demand. Furthermore, the quality of Vietnamese pepper has been improving and diversified, boosting the export value of goods.
During all this time, despite the serious impact of the COVID-19 pandemic, export pepper output has increased in the US, EU, and Middle East markets, while declining in China.
The figure shows that after peaking at 120,000 VND/kg in January 2017, after that the price of pepper has dropped sharply from approximately 40,000 VND/kg in March 2020.
In April 2020, the price of pepper begins to rise again, reaching 90,000 VND/kg in October 2021.
The highest Vietnamese pepper price since 2017.
After four years of steadily falling prices, the pepper industry has seen a significant recovery in 2021, with prices rising rapidly from 51,000 to 53,000 VND/kg to 76,000 to 79,500 VND/kg in mid-February and the price of pepper has increased to 90,000 VND/kg at the end of October, this is the highest price since the end of 2017 until now. Is this the beginning of a price recovery and the end of a four-year declining cycle, indicating the start of a new bull cycle?
The market was quiet at the end of the year, but in general, 2021 was a prosperous year for the pepper industry. Compared to the beginning of 2021, the year-end price has increased by 53-54% and is a high price in comparison to recent years.
The sharp increase in the price of pepper in the past year, partly due to a decrease in output compared to previous years, farmers have focused on tending, or switched to other crops; because of the series of consecutive price drops of the pepper industry in the last 4 years.
Pepper prices are expected to rise in 2022.
According to many experts, pepper prices will continue to rise in 2022 because of the gap between supply and demand, while demand rises again, supply may fall. On the one hand, because the price of pepper had declined in previous years, it diminished the planting area and replaced it with other crops. On the other hand, major pepper-producing countries like Brazil are also being affected by unfavorable weather which will reduce pepper production in 2022.
According to data from the International Pepper Association (IPC), in 2021, output was just 220 thousand tons, compared to 240 thousand tons in 2020 and 260 thousand tons in 2019. This indicates that pepper production in Vietnam has declined from 2019 to 2021, and it is expected to continue to decline in 2020. Besides, consumer demand is gradually recovering after the covid-19 pandemic since 2019.
Because of the above factors, pepper prices are expected to rise further in 2022. Aside from the aforementioned causes, pepper speculation by speculators will have a substantial influence on pepper prices in 2022. Other factors, such as production costs and shipping costs, will also have a substantial impact on pepper prices in 2022.
Sybil Agri is a pioneer in developing a sustainable pepper supply chain.
In the last ten years, the pepper industry has remained unstable; if supply increases, the price is at risk of plummeting. For example, in the period from 2106 to 2020, when production output rises, prices fall steadily until they reach a bottom in 2020. On the other hand, in 2021, volume decreases but prices increase sharply.
Therefore, the sustainable development of pepper is a prerequisite for the Vietnamese pepper industry to maintain its position in the international market.
For that reason, from the first day of operation, Sybil Agri has gradually built a sustainable pepper chain in order to enhance the value of domestic pepper, in addition to supplying the global market with high-quality pepper products at reasonable prices and ensuring a large output all year round.
Through the partnership program between Sybil Agri and farmers (SFPP), together with 2 factories in the raw material area and sales representatives in Vietnam, Singapore, and the United States, Sybil Agri has built a sustainable pepper supply chain from the farm to the production and distribution of products to customers.
Thanks to owning a sustainable supply chain, Sybil Agri maintains production and exports orders on time for clients, despite the challenge of the covid-19 pandemic in Vietnam. In addition, during a business trip to attend the Expo 2020 Dubai, Sybil Agri met with loyal customers to discuss orders for export in 2022.
The pepper market is currently experiencing a lot of fluctuation; if you want to update the detailed pepper prices, please join the Whatsapp group.
Visit https://sybilagri.com/tag/pepper-price/ to find more about pepper market information.