Exim News

Minimum import price levy raises local pepper rates

Kochi: The Centre’s decision to impose minimum import price (MIP) of Rs 500 per kg on black pepper has helped improve local prices of the commodity though it has evoked the sharp reaction from re-exporters who have made a strong plea to exclude them from the levy. 
Black pepper prices rose by 8 percent in a week since the decision to around Rs 410 a kg. The prices had slumped by over 40 percent to a four year low of Rs 390 per kg with a surge in pepper imports from Vietnam routed through Sri Lanka taking advantage of the lower duty of the latter. 
“It remains to be seen whether the higher prices will be sustained as the supply will be strong with the prediction of a good crop next year and inventory yet to be cleared in ports,’’ said Kishor Shamji a major exporter. The prices may not scale the level of Rs 700 a kg achieved last year. 
Meanwhile, re-exporters have cried foul at the levy of MIP of Rs 500 as they feel it will kill the units engaged in export of value-added pepper. All India Spices Exporters Forum (AISEF) has written to Commerce Minister Suresh Prabhu to exempt 100 percent EOUs, SEZs and oleoresin companies from the purview of the notification. 
The forum said that they fully understand that the notification has been issued to protect the interest of farmers. However, the pepper re-export industry does not sell anything in India and it imports light berries (not saleable in India) and re-export after value addition. 

‘‘The imports are made against specific export orders through the advance licence that specifies quantity and value obligation. If they import by paying Rs 500 a kg, the export value will not be achievable and they may even incur the additional loss with payment for the shortfall in export value obligation,’’ AISEF chairman Prakash Namboodiri said. According to him most of the companies are already reeling under the delay in refund of GST. The forum has suggested to the government to make necessary modification to the order so that reexporters are not hit badly. 
Kishor Shamji said the imported pepper from Vietnam and Brazil should be subject to pesticide residue checks as part of its finding its way to the domestic market after extraction.

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