2019 was a dreary year with the pepper industry when domestic prices and export prices dropped sharply due to excess supply. This year, most likely the price will still continue to decrease but by 2021, 2022 the forecast price will increase gradually.
According to Vietnam Agriculture Newspaper, in 2019, the supply of pepper was abundant, exceeding demand, causing domestic and export prices to plummet. This is the 3rd consecutive year that the export value of pepper has decreased compared to the previous year. According to estimates, in 2019, Vietnam exported 287 thousand tons of pepper, worth US $ 722 million, up to 23.4% in volume but down 4.8% in value compared to 2018.
Pepper prices plummeted globally. In 2019, Vietnam’s pepper export price averaged only US $ 2,518 / ton, down to 22.9% compared to 2018. Because supply still exceeds demand, it is likely that in this crop, pepper prices will continue to decrease.
Pepper prices will remain low throughout the season. It is forecasted that by 2021, pepper prices may have increased slightly and have started to increase since 2022, when pepper production has decreased in Vietnam and globally as many farmers saw low prices, switch to other crops and productivity decreases because a large area lacks investment and care.
After inventory checks and first surveys were carried out, the following forecast are speculated for the 2020 harvest:
- The total area of Daklak and Daknong provinces is 74.916 hectares, some 50% of which is used for pepper cultivation.
Due to favourable climate conditions, it is estimated that 2020 production will increase 10% compared to 2019 harvest.
- Land prices have risen in the last 2/3 years in Dong Nai and Ba Ria Vung Tau provinces, due to its proximity to Ho Chi Minh.
Consequently, many farmers have been forced to sell or rent its lands. There is therefore speculation that the area under cultivation will decrease 20%.
- There aren’t big changes in Binh Phuoc province, but farmers are considering growing other products, so the amount harvested will be inferior than in 2019.
- In Gia Lai province, pepper plantations have dropped tremendously since 2017. Main reasons are the lack of experience of the farmers and a not favourable climate. It is forecast that production will descend 60%.
Formerly, this province was known as the Vietnam pepper capital, but as a result of the financial situation, many farmers couldn’t face the loan interests, so they’ve been forced to sell its lands and pepper plantations.
- In the other areas, there are several climate and natural conditions, so there isn’t an estimation about the available quantity for 2020 harvest.
Given those estimations, farmers and processors highlight that the total production for 2020 harvest, will be 10-15% less compared last year, approximately 250.000-270.000 tons of Vietnam pepper. Nevertheless, the quality of this product will be better.