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Vietnamese pepper exporters sell themselves cheap
Experts all predict that the pepper price will increase in the world’s market. However, Vietnamese exporters do not have much pepper to export, as a big volume of product was exported before at low prices.
The Vietnam Pepper Association has predicted that the pepper price may reach $5,000 per tonne in the last months of the year due to limited supply.
Vietnam has finished harvesting the 2008/2009 crop with the output of 95,000 tonnes, an increase of 4,000 tonnes, or 4.4 percent over 2008.
All information sources have forecast the short supply of pepper on the world’s market. The pepper output in Indonesia is expected to decrease due to bad weather, while in Brazil, output is also expected to decrease due to heavy rains.
In the first months of the year, the Vietnam Pepper Association advised its members to sell products at a moderate level in order to be able to control export prices. At that time, in an attempt to keep the export price at $2,500-3,000 per tonne, the 10 leading Vietnamese exporters, after studying the market’s demand, announced they would sell just a portion of the pepper they had, while the remaining would be put in stock to be sold when prices increased.
The commitments made by the 10 big guys, who make up 70 percent of total exports, were applauded by domestic banks. ABBank, Vietcombank, Techcombank, ACB and some other big credit institutions supported the pepper exporters by extending credit limits to fund their speculation plans.
However, the exporters did not stick to their commitments. More than 80 percent of the pepper output this year was exported in the first seven months of the year.
According to the Ministry of Agriculture and Rural Development, Vietnam exported 65,000 tonnes of pepper in the first six months, which brought the export turnover of $149 million, an increase of 37.22 percent in quantity over the same period of last year, but a decrease of 10.89 percent in export turnover.
Vietnam exported some 15,000 tonnes of pepper more in July, which means that it only has 15,000 tonnes to export between now and the end of the year.
According to the world’s pepper association, in 2009, Vietnam will lead the world in terms of pepper production with more than 90,000 tonnes, followed by India with 60,000 tonnes, Brazil 37,000, Indonesia 25,000 and Malaysia 22,000.
vietnamnet, tp
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