Commodities

New harvest brings fresh pepper to terminal market, but demand slows

V Sajeev Kumar Kochi | Updated on January 20, 2020 Published on January 20, 2020

Despite domestic demand continuing to be slow, pepper arrivals have started improving at the terminal markets, thanks to new harvest. Simultaneously, following stringent action by the Centre, imports from Sri Lanka have declined drastically.

In the Kochi market, prices saw a ₹1 drop per kg for the 23 tonnes offered on Monday. The average price realised was ₹320/kg for ungarbled varieties, while MG1 garbled varieties quoted at ₹340. New pepper stood at ₹305.

Kishore Shamji of Kishore Spices said there was subdued demand and whatever small quantity arrived was being picked up by inter-State dealers for end-user consumers. However, the quality of the new crop is yet to improve, and the farmers’ response in the wake of a further price drop is a crucial point, he said.

Scattered arrivals

It is expected that the arrivals will remain scattered since farmers are making their harvests in a distributed model only.

According to Shamji, Indian pepper production is anticipated at 65,000 tonnes in calendar year 2020, while some experts place the figure at 75,000 tonnes. Similarly, carry-forward stock from 2019 is estimated at 10,000-15,000 tonnes, which indicates that the domestic demand in 2020 can be easily met with locally produced pepper. However, farmers are worried that imports may destabilise the price levels.

The Vietnam pepper market will close by Friday to celebrate the Chinese New Year and reopen in mid-February only. Brazilian farmers are reported to have destroying their pepper vines due to unviable prices, which is hovering below $2,000 there.

Chinese consumption appears to be catching global attention. The Vietnam export figures for 2019 show that more than 57,500 tonnes were shipped to China, crossing the US import figures. Indian imports from Vietnam stood at 20,000 tonnes, coming third.

Import worries

The farmer community is also worried about pepper imports for value addition, as they feel that the extracted waste as well as lower grades and some sieved-out bolder varieties may slip into the domestic market, snatching the share of Wayanad pepper. They have cautioned the Spices Board and other agencies to enforce strict monitoring, Shamji said.

Published on January 20, 2020
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