Vietnam glut hits Indian black pepper export

Vietnam glut hits Indian black pepper export 

KOCHI: A glut in black pepper production in Vietnam is spoiling India's export party. 

Vietnam, which had a record crop of 2 lakh tonnes (almost half the world's total production) saw prices drop to $5,000 to $5,250 per tonne. Indian black pepper prices are hovering around $9,000 per tonne which makes exports uncompetitive. 

“Our black pepper exports dropped by nearly half from 2,500 tonnes to 1,000 tonnes last fiscal when Indian prices ruled higher in the global market. This year too the same trend may continue," said Gulshan John, managing director of exporting firm Nedspice India. As per data from Spices Board, black pepper exports from India plummeted by 40% in quantity and 37% in value for the nine months to December 2016 at 14,100 tonnes worth Rs 903 crore from a year earlier. The final figures for 2016-17 are yet to be released but is expected to be much lower than 28,100 tonnes of the previous year. With prices ruling high due to a shortage of pepper in India, exporters had to depend more on imports last year. The unofficial figures put the import in 2016-17 at 19,000 tonnes, close to 20% higher than the year before. In the current fiscal, imports are anticipated to top 20,000 tonnes given the plunge in price of Vietnamese pepper. 

“At the current Vietnam price levels, the import price to India will be Rs 340 per kg without duty. After paying duty it could be still less than around Rs 600 per kg level in India," said Jojan Malayil, CEO of Bafna Enterprises, a major exporter.