Pepper price hits seven-year low

HCMC – The pepper price has plunged to a seven-year low of VND80,000 (US$3.52) per kg as it has eased off its multi-year spike.

In July 2010, pepper hovered around VND80,000 per kg, the highest level since 2006. And since then, it had steadily rallied and briefly hit VND200,000 per kg.

However, the pepper market began rearing its ugly head early this year, with the price steadily edging down.

The pepper price news website at giatieu.com reported it is difficult to forecast pepper price movements under the current market conditions. Some farmers said they had stopped selling due to the woefully low price, throwing pepper exporters into a difficult position. But others said they had been boosting sales to trading firms but traders had not been financially able to buy more.

The price of this commodity is expected to inch up slightly, especially for contracts with September and October deliveries, according to information on www.commodityonline.com.

According to the Vietnam Pepper Association (VPA), the price decline has resulted from an upsurge in domestic supply. The association advised farmers to stop expanding production, which could lead the pepper price to drop further.

Vietnam now has more than 100,000 hectares under pepper farming, double the original plan.

Vietnam exported some 99,000 tons of pepper in the first five months of this year, up nearly 10% year-on-year, but the export value dipped around 19% to US$586 million as the January-April average export price was 25% lower than in the same period last year, at US$6,106 per ton, said the Ministry of Agriculture and Rural Development.