The Hindu Business Line : Pepper prices likely to scale new heights

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Kochi Feb. 6 If the reported production trend in the pepper-producing countries is any indication, pepper prices are destined to witness a steep rise in 2007. This makes the 10-year cycle theory of price rise a reality as the last increase in the world market started in 1997-98 and continued till 2000-01.

During the 1997-98 increase, the unit value of the commodity shot up to Rs 138.23/kg from Rs 86.09 the previous year. It went up to Rs 180.81 the next year, rose to Rs 206.73/kg in 1999-2000 before dropping to Rs 174.45 the following year. Thereafter it is only now that the prices have crossed Rs 100/kg.

Similarly, the prices started its upward swing in 1985-86 with Rs 45.85/kg to Rs 54.02 the next year, peaked in 1987-88 to Rs 58.66/kg and showed a downward swing from the next year.

Prior to that it was in 1977-78 that an increase in pepper prices was recorded.

Reports emanating from other places of origin such as Brazil indicate a sharp fall in production due to erratic weather conditions. In Brazil, due to the El Nino effect, there has been no rainfall, and as a result, in plantations where flowering took place in November/December last year the spikes are falling, a report said. Rainfall is forecast from March 15 and if these reports turn out to be true, the Brazilian crop would have a disastrous end, the international report indicates.

Similarly, another report said that Vietnam could be affected by the El Nino effect in February and if the prediction turns out true there could be heavy damage to the crops. Harvesting in Vietnam has already been delayed.

Indian scenario

The Indian scenario is also grim. The crop in the Kodagu region is estimated to be less by over 40 per cent.

According to Dr Jacob Thomas, a senior Agricultural Scientist who closely monitors developments in the plantation crops such as coffee, pepper and cardamom in this region, the erratic rains last year have affected the pollination and berry formation. "The berry per spike is very low," he told Business Line on Thursday.

According to Dr Thomas, the prices would cross Rs 150/kg.

"Anything above Rs 100/kg is very good," he said.

Other factors, which have affected the crop, are the quick-wilt disease and neglect of the vines due to poor and un-remunerative prices.

Quick-wilt disease can be controlled to some extent by applying copper sulphate but growers could not afford to buy it. Moreover, the un-remunerative prices during the past several years have discouraged them to undertake new planting or re-planting.

Also, no farm management practices such as reduction of shades were followed. As a result, there has been no increase in the area under the crop in the Kodagu region. On the other hand, because of good coffee prices, many planters have neglected the pepper vines, he pointed out.

Kerala decline

The situation in Kerala is not different. The reasons attributed to the fall in output are the same as in Coorg. The crop in major growing-areas of the State — Wayanad and Idukki districts — is said to be declining, with the farmers in some areas claiming it would fall by 75 per cent. However, the average decline in output is estimated to be around 50 per cent.

Given this scenario, the Indian output in 2007 is estimated at around 40,000 tonnes as against the domestic demand of about 50,000 tonnes. The situation would thus necessitate imports to meet the domestic demand, Dr Thomas said.

The world output is also estimated to be less by 15 to 20 per cent.

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