Indian buyers eye pepper from Indonesia

India will import around 4,000 tonnes of pepper from Indonesia during the December-April period as prices of the commodity are cheaper than that in Vietnam, another major pepper producer.

Indonesian exporters are offering Lampong ASTA grade pepper at $3,200 a tonne (c&f Kochi), which was ruling around $3,500 a month back.

In India, a squeeze in supply coupled with an increase in domestic demand has pushed the local prices to $3,600 (fob Kochi). In Vietnam, the prices of V-ASTA grade are ruling at $3,500 (fob HCMC).

Although Brazil is offering pepper at a cheaper rate ($3050), the time lag in bringing the stuff is forcing the Indian companies to import pepper from Indonesia. Besides, the quality of pepper in the South East Asian nation is superior to that of Brazil. A leading Kochi-based company has alone placed orders for 1,000 tonnes.

During April-October, imports of pepper touched 7,550 tonnes against 12,167 tonnes in the same period last year. A major part of the import is for grinding, as Lampong is the world's finest grade for producing ground pepper.

Indonesia is very active in selling pepper to India as demands from the EU and the US have weakened owing to high stocks there.

Meanwhile, availability of farmgate pepper is very low in the domestic market due to increased demand from the North ahead of the winter. The delay in the arrival of new crop will also make supply conditions more tight for next 6-7 weeks.

The first lot of the new crop is expected to hit the market only by the next month and the market may continue on a slightly upper level.

But a steep rise in the prices can be ruled out as buying is limited to smaller quantities.