Monday, March 7, 2011
Pepper declines on weak export demand
Pepper spot prices and futures ended 0.53% and 0.64% lower respectively on account of weak overseas and domestic demand on Saturday. Reports of fresh arrivals from Vietnam and their pepper prices quoting at lower levels might however restrict prices from trading higher.
Harvesting in Vietnam has commenced and the prices offered by them in the international market for their 550Gl are around $4,500/tonne. Arrivals are likely to gain momentum by March. In the first month of this year pepper exports from nation was around 7,000 tonnes. According to the Ministry of Agriculture and Rural Development (Vietnam), pepper exports in January year-on-year jumped by 40.7 per cent despite a decrease of 7 per cent in volume (Source: Peppertradeboard).
According to International Pepper Community (IPC) report, export of black pepper from Indonesia in 2010 surged by 28% and stood at 50,000 mt as compared to 39,150 tonnes in the same period previous year. In the month of January 2011exports of pepper from Lampung port stood at 2,500 mt.
Import of Pepper in U.S. in 2010 gained by around 7% and stood at 70469 tonnes as compared to 65,855 tonnes in 2009. Indonesia held its position of being the largest exporter shipping around 25,174 tonnes to U.S. followed by Brazil (11,517), Vietnam (10,241) and India (4,064) tonnes.
Production and Arrivals
Arrivals of pepper in the domestic mandi on Saturday were around 20 tonnes amidst lower offtakes of 05 tonnes as compared to 10 tonnes of arrivals and similar offtakes on Friday.
Production of pepper in India in 2010-11 is projected to be 48 thousand tonnes (according to the Spices Board) as compared to 50 thousand tonnes last year. However, there are expectations that this estimate would be lowered further on account of the disease attacks and erratic rainfall in the major growing areas particularly Kerala and Karnataka.
In the international pepper markets too output is expected to decline this year. Black pepper production in Vietnam, the largest pepper producer, is likely to be lower by around 9 percent at 1 lakh tones as compared to 1.10 lakh tonnes in the previous year.
Pepper production in Brazil stood around 27,000 tonnes in 2010-11 as compared to 35,000 tonnes the previous year.
Outlook
Pepper prices in the intraday are expected to trade sideways on account of lower arrivals in the domestic mandi and lackluster demand from overseas buyers. Fresh arrivals which may gain pace in the coming days in Vietnam are likely to pressurize prices.
In the short term (March), Pepper prices will depend on demand from the overseas and domestic market and fresh arrivals in the physical mandi in Kochi. Prices will also take cues from the Pepper fresh arrivals in Vietnam and pepper prices in the international market of various origins particularly India, Vietnam, Indonesia and Brazil. In the medium to long term (April onwards), price trend will depend on pepper stocks with Indonesia and demand from the overseas and domestic buyers.

This post was written by: HaMienHoang (admin)
Click on PayPal buttons below to donate money to HaMienHoang:
Follow HaMienHoang on Twitter
0 Responses to “Pepper declines on weak export demand”
Post a Comment