Vietnamese farmers and businesses are worrying as pepper export revenue is expected to drop to under 1 billion USD in 2018 for the first time after four years despite strong increases in shipments.
The pepper industry plans to reduce the area under the spice and focus on improving quality to ensure long-term growth, according to the Ministry of Agricultural and Rural Development.
Vietnam will work to reform its peppercorn sector towards high quality production and food safety, instead of expanding cultivation areas, Minister of Agriculture and Rural Development (MARD) Nguyen Xuan Cuong has said.
Vietnam’s output and export of pepper increased sharply last year, but their prices and thus turnover from exports fell, according to the industry association.
When international market pressures challenged Vietnamese farmers to adopt good agricultural practices and produce organic pepper, many responded positively.
The price of pepper in Vietnam has gone up and down recently, allegedly due to unexpected Chinese purchases.
Major agricultural products enjoyed a rise in export value in the first half of this year despite a fall in volume, according to the General Department of Vietnam Customs.
Over the last ten days, pepper prices have fallen from an already low 82,000 VND (3.65 USD) to 72,000 VND per kilogramme, but pepper farmers in the Central Highlands continue to hold out for higher prices.
Links between enterprises and coffee and pepper farmers need to be enhanced to improve the economic value and competitiveness of the two products.
The Ministry of Industry and Trade (MoIT) has added pepper to the list of commodities traded on the Vietnam Commodity Exchange (VNX), according to the ministry’s Decision 1071/QĐ-BCT issued last week.
2017 is forecast to be a difficult year for Vietnam’s pepper, which has seen falling prices since the end of 2016, according to the Ministry of Agriculture and Rural Development (MARD).
Small-sized enterprises are concerned that they would have to borrow from credit institutions at higher rates when new lending regulations take effect next month.
Peppercorn export has experienced a decline in both value and volume in the first two months of 2017, according to the Ministry of Agriculture and Rural Development.
Vietnamese pepper will face stricter scrutiny this year on excessive use of agricultural pesticides, especially in the EU and US markets, experts say.
The Ministry of Industry and Trade expects pepper to remain a key foreign currency earner for Vietnam this year, with targeted export turnover of 1.6 billion USD despite a fall in output in some farming areas.
Solutions for the sustainable development of pepper cultivation were the focus of a forum held in the southeastern province of Binh Phuoc on October 31.
Vietnam earned 1.2 billion USD from the export of nearly 145,500 tonnes of pepper in the first nine months of the year, a year-on-year increase of 31.5 percent in volume and 13.1 percent in value.
The high price of pepper, combined with a drop in coffee prices, has pushed many farmers to switch to cultivating pepper vines.
