Black pepper prices under pressure on rise in output
Indian production is seen at 55,500 tonnes this year against 48,500 tonnes in 2016
As the demand for Indian black pepper from stockiest and retailers has been heading southwards recently, prices have dropped significantly. However, other prices ruled fairly steady in the absence of necessary buying activity. Black pepper prices fell by Rs 20 per kg to Rs 680-750 per kg by the end of the last week from last Thursday’s closing prices at Rs 700-770 per kg.
Analysts expect prices to drop further due to arrival pressure of the new crop in the two major pepper producing countries – India and Vietnam. While India is the second largest producer after Vietnam, it’s the largest consumer of pepper in the world. Significantly, harvesting has been delayed in both India and Vietnam by at least one month due to climatic issues.
Vietnam, which was nowhere in the spices market some eight years ago, today is number one producer of pepper. It produces 10 times more than India’s overall production. Its productivity has reached unparalleled proportions in a short span and produces 2.5 tonnes of black pepper per acre. Indonesia claims that it now stands second and India has slumped to the third spot in pepper production.
The international pepper community (IPC) has pegged Indian pepper production for 2017 at 55,500 tonnes against 48,500 ton­nes in 2016. Some traders feel total production could be actually around 60,000-65,000 tonnes despite the damage by the drought-like situation in Kerala and Kar­nataka, the to major black pepper producing states in India. It’s also because in Karnataka, pepper is grown mainly in the irrigated coffee plantations and is less monsoon sensitive.
Traders feel that higher production will lead to larger arrivals at mandis and which in turn will cause a drop in price. The domestic consumption, meanwhile, is estimated to grow to 51,500 tonnes, according to IPC.

On Vietnam, IPC pointed out that drought followed by El Nino did affect the crop in the early stages. Plant diseases further compounded it. But Vietnam has brought new areas under pepper cultivation, which would keep the total production up.
According to a recent report by the Netherlands-based Nedspice, the pepper market could be volatile in 2017 with pipelines empty and production estimated to increase. During 2016, the global stock ratio remained very low, as pipelines were empty. Thus the supply-demand balance is vulnerable. However, it added that there was a possibility of significant increase in global production in 2017.
Amidst all these, the good news is that the Indian long pepper, widely popular for spicing up food, may soon be used as a potential cancer treatment drug, according to a new study. The Indian long pepper contains a chemical that could stop your body from producing an enzyme that is commonly found in tumors in large numbers, according to the study in Journal of Biological Chem­istry. Whether this spurs up pepper demand remains to be seen.
ritwikmukherjee@mydigitalfc.com
Columnist: 
Ritwik Mukherjee