Pepper prices are on a high, touching R630 per kg mostly due to tight supply. As availability has dwindled, processors are importing the commodity from Vietnam.
The market is likely to remain firm until the Karnataka crop or stocks seized by the Food Safety and Standards Authority of India (FSSAI) are released into the market, traders said. India is the largest consumer of pepper in the world and the second-largest producer after Vietnam.
?Import of pepper from Vietnam is happening with the difference between the two origins coming to R200 per kg. Supply is really tight in the domestic market. In the global market, Vietnam has sold 30,000 tonne till March and hopefully they will sell another 20,000 tonne in April,? Jojan Malayil, a leading exporter from Kochi, told Fe. ?My guess is that they will hold on to the rest of the pepper to get better returns. If the buyers want more, market prices are likely to move up further. Pepper from other places like Malaysia and Indonesia are likely to be on the lower side as farmers are not in a hurry to sell,? he added.
The recently concluded International Pepper Community (IPC) annual conclave reports that global production in 2014 would be around 6,000 tonne lower. According to IPC figures, production in 2013 was pegged at around 3,16,832 tonne. A paper presented in the World Spice Congress at Kochi reported that India?s pepper production in the 2013-14 season would be 34,000 tonne against the 45,000 tonne reported by the International Pepper Community (IPC).
?The market is likely to remain firm if the supply remains at the current level. Pepper from Karnataka will come to the market once the state elections are over. This is likely to provide some relief to the over-heated market. Stocks with FSSAI can also provide a relief if they are released. Meanwhile, some imported pepper is also finding its way into the market due to the huge premium in the domestic market,? Kishore Shamji, a senior exporter and member of India Pepper and Spice Trade Association (IPSTA), said.