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Vietnam Spices Market Update 11th Jan 2021 – week 1&2

12 January 2021



Pepper exports in December 2020 reached 23 thousand tons, worth 62 million USD, up 0.3% in volume and 2.5% in value compared to November.Approximately pepper export in 2020 is estimated at 288 thousand tons, worth 665 million USD, up 1.2% in volume. The average export price is estimated at 2,313 USD/ton, down 7.9% compared to 2019.


Pepper prices from the first week of 2021 are being affected by the news of the Covid-19 epidemic and trade tensions between major countries.Due to the closure of the countries due to Covid-19 and the political situation in the US and UK, the strained US-China relations affected goods greatly.At this time, the low price caused speculators to increase buying, but the transaction was still quite bleak.


Vietnam's pepper prices in the short term will be quiet in the absence of supportive factors. The main reason for the recent price drop is the tension situation of the shipping charges and the shortage of containers. Many routes to EU/AFRICA/USA… increased galloping with an increase of 500-7,000 $ per container of export cargo. There is a 1000% increase in just 30 days with some destination in ASIA. This situation may continue, causing the fact that pepper produced in Vietnam cannot be exported much to other countries. Materials are clogged in production warehouses and at ports of destination because some shipping agents cancelled booking/increase price without reason.


Besides, the present time the key pepper province of Vietnam is Daknong province has starting the harvest season, so the export price of pepper lacks a supporting factor.However, price of pepper at spot market up daily and many customer shortage stock to process because almost all waiting reduce for cost freight. We might be seen huge demand will come again in the market when freight/container space back to normal.


In the medium term, global pepper production will continue to decline as top producing countries do not implement new planting, while the maintenance of existing pepper farms is not focused, many pepper farmers are not growing also focus on profession because the price now not attractive to the farmer. If this situation continues in the next years, the price of pepper will tend to increase in 2021 & 2022.The exchange rate of Vietnam currency in 2021 is forecast to be about 2% stronger than USD, which will also an increase price in exports from Vietnam compared to previous years.



India's pepper production in 2021 is likely to be significantly lower than in 2020, The reason is that the cultivation and production of pepper is affected by erratic climate, typically strong winds and heavy rain in Idukki, Wayanad, Coorg districts and some areas in Karnataka state. Currently, the new harvest on the farms is coming. However, many farmers are delaying the harvesting process due to unfavorable weather.



The market continues to grow strongly when demand is high but inventories have decreased rapidly. Raw material prices are forecasted to continue to rise as demand is high from the EU/USA and ASIA.



The market increased rapidly due to strong demand, in addition to a serious crop failure in spring due to storms and droughts. It is expected that the price of anise will continue to increase in 2021 while there is very little inventory.







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