Pepper market awaits Vietnam, India output cues

The global pepper mart is poised for hectic activity as two major producing nations "� Vietnam and India "� have started quoting their prices, and harvesting in the two countries has got off to a start, albeit on a slow pace.

However, a definite direction of the market would be known only after a clear-cut production picture emerged in both the countries, experts said. Surely, there would not be a bull phase at least for the next eight-ten weeks, they felt.

Vietnam traders are now in a rush to sell out the backlog of 2006 as harvesting will be at its peak by next month. So, the country has slashed its price for January shipment on reports of almost same-level production in the new season.

As per its latest pricing, Asta variety costs $2,375 a tonne (FOB), $2,120 for 500 gm/ litre and $2,250 for 550 gm/ litre. Further, major exporters believe Vietnam would slash its Asta price to $2,000 a tonne by February.

But the key factor influencing the global black pepper market is the approach of importing nations such as Europe and the US.

Leading Kochi-based exporters said as importing countries were fully covered for the next couple of months, there was no urgency of buying pepper at least for that period.

Hence, they said, a definite turn for the pepper mart would evolve only after a few weeks, and the exact estimate of production in Vietnam would also be known by then.

Interestingly, reports of different estimates about Vietnam's production levels came out in the open. This, however, may help in determining the direction of the pepper mart going forward. According to the latest estimates of major exporting companies, the total production at around 1,10,000 tonne would be slightly lower than the 1,20,000 tonne seen in the 2006 season. Last year, the country exported 1,17,000 tonne.