The global pepper market is in the midst of an unmistakably bullish phase as supply concerns, adverse weather, and robust demand converge. In India, particularly the key producing regions of Kerala and Karnataka, erratic rainfall and unusual weather patterns have harmed this year’s crop, significantly tightening local availability. At Kochi, a benchmark spot market, black pepper prices have climbed from last week’s $9.35–$9.50/kg to $9.50–$9.75/kg. Daily arrivals are notably weak, with insufficient supply to satisfy the steady buying interest from both bulk buyers and spice exporters. This squeeze is mirrored on the international stage, where Vietnam—the world’s leading supplier—reported lower production levels and elevated export offers, further evidence that pressure on global supplies may endure into 2025.
Catalyzed by robust export interest from Europe, the Middle East, and the United States, Indian exporters are experiencing a surge in overseas inquiries. With both major and secondary producers facing production shortfalls or weather challenges, prices are likely to sustain their upward trend. The consensus among market analysts: Unless there is a pronounced improvement in weather conditions across key origins, the rally in pepper prices is far from over. For traders, processors, and industry professionals, this creates a market landscape where vigilance and tactical buying are essential.
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FOB 8.50 €/kg
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📈 Prices: Fresh Snapshot
| Product | Type | Origin | Location | FOB Price (EUR/kg) | 1-Week Change (%) | Market Sentiment |
|---|---|---|---|---|---|---|
| Pepper powder | Black | IN | New Delhi | 8.80 | +0.57% | Bullish |
| Pepper | White Whole | IN | New Delhi | 7.07 | +0.71% | Bullish |
| Pepper | Green Dehydrated | LK | Sri Jayawardenepura Kotte | 8.50 | +0.59% | Supported |
| Pepper | Black Whole 500 g/l | IN | New Delhi | 8.10 | +0.62% | Bullish |
| Pepper | Black 600 g/l Clean | VN | Hanoi | 6.43 | +0.78% | Firm |
🌍 Supply & Demand Drivers
- Supply Limitations: Poor weather in Kerala and Karnataka (India), and lower production in Vietnam, keep global supplies tight.
- Rising Demand: Export buying from the Middle East, Europe, and U.S. is robust, with Indian exporters reporting increased inquiries.
- Inventories: Low arrival rates in benchmark markets and aggressive bulk buying have further eroded stock levels.
- Speculative Activity: Prospects of further tightening have attracted speculative interest, adding to market firmness.
📊 Fundamentals & Market Comparison
| Country | 2024 Output (Est, mt) | 2023 Output (mt) | YoY Change | Stock/Comments |
|---|---|---|---|---|
| Vietnam | 175,000 | 207,000 | -15.5% | Stocks sharply lower, export offers firm |
| India | 67,000 | 73,000 | -8.2% | Yield loss due to erratic rains |
| Indonesia | 80,000 | 84,000 | -4.8% | Stable but exportable surplus smaller |
| Brazil | 60,000 | 70,000 | -14.3% | Supplies tight, exporters cautious |
| Sri Lanka | 19,000 | 21,000 | -9.5% | Domestic demand high, exports limited |
🌤️ Weather Outlook: Key Growing Regions
- India (Kerala, Karnataka): Recent heavy rainfall interspersed with dry spells is expected to persist, with below-average soil moisture likely to affect next season’s crop.
- Vietnam: Persistent drought conditions forecasted over the next week may impede crop maturation, putting further pressure on yields.
- Indonesia & Brazil: Both regions face unsettled weather, including short dry periods alternating with excessive rainfall, raising concerns about fungal diseases and pepper berry drop.
Impact: Continuing adverse weather in top origins supports the bullish price environment by limiting yield recovery and new supply.
📆 Trading Outlook & Recommendations
- Expect continued upward momentum in black pepper prices through late 2025 unless weather significantly improves in key producing regions.
- Weaker arrivals and dwindling inventories signal limited near-term downside risk.
- Bullish sentiment likely to drive further speculative and retail activity.
- Exporters and processors should secure contracts promptly to lock in favorable prices before further increases.
- Watch for weather updates and output revisions in Vietnam and India; short-term corrections possible only if conditions improve markedly.
- End-users advised to hedge future requirements against continued volatility in supply and price.
⏩ 3-Day Regional Price Forecast
| Market/Exchange | Current Price (EUR/kg) | 3-Day Forecast (EUR/kg) | Trend |
|---|---|---|---|
| Kochi Spot (India, Black Pepper) | 8.10 | 8.15–8.30 | ⬆️ |
| Hanoi FOB (VN, Black 550 g/l) | 6.05 | 6.10–6.20 | ⬆️ |
| New Delhi FOB (IN, Pepper powder) | 8.80 | 8.85–8.90 | ⬆️ |
