Price Dip Doesn’t Help Pep­per Ex­ports

Viet­nam and Brazil con­tinue to dom­i­nate the ex­port mar­ket with lower prices than In­dia

The Economic Times - - Finance & Commodities - Kr­ish­naku­mar.PK @times­group.com

Kochi: In­dian pep­per ex­ports are not pick­ing up de­spite a dip in lo­cal prices as Viet­nam and Brazil are sell­ing the spice at lower rates in the global mar­ket.

Prices in In­dia fell about 6% in a month to .₹ 649 a kg for the gar­bled va­ri­ety. The In­dian prices are $3,000 to $3,500 a tonne higher than Viet­nam.

Last year’s pro­longed dry spell has af­fected out­put. “Though ar­rivals are good, the bulk den­sity of pep­per is less, which could pull down over­all ton­nage,” said Kishor Shamji , a ma­jor ex­porter. Early dur­ing the sea­son, grow­ers could not

sell green pep­per due to the cash crunch fol­low­ing de­mon­eti­sa­tion. The bulk den­sity of such pep­per once it ma­tures will be lower, Shamji added.

“It seems the drought has af­fected out­put. We now ex­pect pro­duc­tion be­tween 55,000 and 60,000 tonnes,” said Jo­jan Malayil, CEO of Bafna En­ter-

prises, an­other ex­porter. Last year, pro­duc­tion fell to a low of 40,000 tonnes. Viet­nam is the largest pro­ducer of black pep­per cur­rently.

The in­dus­try is now re­vis­ing pro­duc­tion fig­ures down­wards from the ear­lier an­tic­i­pated 60,000 tonnes. Cur­rently, ar­rivals are com­ing mostly from Ker­ala while the crop from Kar­nataka, the largest pep­per pro­duc­ing state, is ex­pected to­wards the end of the month.

Black pep­per ex­ports have been sus­tained mainly through im­ports from Viet­nam, In­done­sia and Brazil as do­mes­tic out­put was priced higher and was hardly suf­fi­cient for lo­cal con­sump­tion. Pep­per ex­ports at 9,750 tonnes valued at .₹ 615.27 crore for six months to Septem­ber 2016 were 47% and 45% lower in value and quan­tity re­spec­tively from a year ago.

Viet­nam is es­ti­mated to have pro­duced around 1.5 lakh tonnes last year. This year, it is ex­pected to be over 1.6 lakh tonnes. Most of the spice ole­o­resin mak­ers usu­ally im­port pep­per for their ac­tiv­i­ties.

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