Will the upward trend continue towards new records?

Pepper price forecast for June 11, 2024: Will it reverse and fall after a sharp increase? Pepper price forecast for June 12, 2024: Will it surge like a storm, reaching 190,000 VND/kg?

The forecast for pepper prices on June 13, 2024, is that they will continue their upward trend, reaching 190,000 VND and aiming for a new record high after several consecutive days of increases. Experts believe that the sharp increase in global and Vietnamese pepper prices is due to Brazil and Vietnam, two countries that determine global supply, experiencing declining production caused by El Nino-induced drought. Supply in Indonesia, India, Malaysia, and Sri Lanka is also limited.

Pepper price forecast for June 13, 2024: Continuing the upward trend towards a new record high.

According to assessments, in the long term, over the next 3-5 years, domestic production will not be able to meet global consumer demand.

Other factors besides supply and demand driving up pepper prices include sea freight rates. The global container index, representing spot container freight rates on major international shipping routes, has returned to its peak levels seen during the Covid-19 pandemic.

According to shipping market research firm Linerlytica, ports in Southeast Asia are becoming the "most serious bottleneck" for global shipping, with 26% of global container shipping capacity currently stuck in the region.

Accordingly, the price of pepper in Dak Lak is being purchased at 179,000 VND/kg, an increase of 9,000 VND compared to yesterday's price. The price of pepper in Chu Se (Gia Lai) is currently at 176,000 VND/kg, an increase of 8,000 VND/kg compared to yesterday. The price of pepper in Dak Nong today recorded a record high of 180,000 VND/kg, an increase of 9,000 VND/kg compared to yesterday.

In the Southeast region, pepper prices increased by 7,000 VND today. Specifically, in Ba Ria - Vung Tau, the price reached 176,000 VND/kg, an increase of 7,000 VND/kg; in Binh Phuoc , the price reached 176,000 VND/kg, an increase of 6,000 VND/kg; and in Binh Phuoc, the price reached 169,000 VND/kg, an increase of 3,000 VND/kg.

Domestic pepper prices on June 12 , 2024

Provinces and cities	Unit	The price offered by traders.	Increase/decrease compared to yesterday
Chu Se (Gia Lai)	VND/kg	176,000	+8,000
Dak Lak	VND/kg	179,000	+9,000
Boeing Nong	VND/kg	180,000	+7,000
Binh Phuoc	VND/kg	176,000	+7,000
Ba Ria - Vung Tau	VND/kg	176,000	+7000

On the world market, at the close of the most recent trading session, the International Pepper Community (IPC) listed the price of Lampung black pepper (Indonesia) at US$6,451/ton; the price of Brazilian ASTA 570 black pepper at US$8,500/ton (up 13.23%); and the price of Kuching black pepper (Malaysia) ASTA remained at US$4,900/ton.

Muntok white pepper prices are at US$7,425/ton (up 0.38%); Malaysian ASTA white pepper prices remain at US$7,300/ton.

Vietnamese black pepper prices remained consistently high, trading at US$6,500/ton for the 500 g/l variety; US$6,700/ton for the 550 g/l variety (up 11.94%); and US$9,500/ton for white pepper (up 15.79%).

Pepper prices have maintained a strong upward trend for nearly two weeks, continuously setting new record highs. According to industry experts and pepper purchasing agents, the current "hot" surge is partly due to Chinese traders resuming pepper purchases after a long absence.

Although the purchasing volume is not yet significant, it has stimulated a more vibrant market, especially in the context of a scarce supply of pepper and the fact that countries that consume a lot of Vietnamese pepper, such as the US and the EU, have continuously increased their purchases since the beginning of the year.

In May 2024, Vietnam's pepper exports to China reached 3,137 tons, a 4.8-fold increase compared to the previous month and the highest level in 11 months.

According to data from China's Customs Administration, the average import price of pepper in the first four months of this year reached US$4,576 per ton, a 6.6% increase compared to the same period last year. Indonesia and Vietnam were the two largest suppliers of pepper.

Notably, Indonesia's share of China's total pepper imports fell to 50.7% in the first four months of this year, compared to 60.21% in the same period last year.

Conversely, Vietnam's market share of pepper in China's total imports increased to 37.5%, compared to 32% in the first four months of 2023.

According to the Vietnam Pepper and Spice Association (VPSA), China has not imported much pepper in the first few months of this year, possibly because it imported nearly 60,000 tons last year and still has pepper purchased in previous years before the COVID-19 pandemic, resulting in excess inventory. However, since the beginning of the second quarter of 2024, China has shown signs of re-entering the market by purchasing white pepper and subsequently black pepper.

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