Chilli Market in 2025: Rising Exports, Tight Standards, and Growing Global Spice Demand

The global chilli market is experiencing dynamic shifts in 2025, marked by a resurgence in Vietnam’s monthly exports and the ongoing expansion of production areas to meet escalating global demand. Vietnam—the world’s second-largest chili exporter after India—has increased its May exports to 190 tons (up 25.8% from April), primarily driven by robust demand from Laos, which accounts for nearly half of Vietnam’s exported volume. Despite this monthly growth, the year-to-date picture remains subdued: the first five months saw exports down 82% in volume and 72% in value compared to the previous year. This underscores the double-edged nature of the market: while immediate interest is rebounding, headwinds from compliance, especially regarding pesticide residues, have weighed heavily on year-on-year results.

Market fundamentals remain strong. With Asia producing 80% of global chilies—India, Vietnam, China, and Indonesia at the helm—Vietnam’s diversified exports to 20+ destinations (including the US, EU, and key Asian markets) present significant upside potential. However, regulatory barriers, particularly on phytosanitary controls, continue to shape the export landscape. Upward momentum is evident in prices, with the global trend towards spicier foods supporting long-term demand, especially as more Western and East Asian markets adopt Vietnamese chili for its signature heat and color.

📈 Prices

Product	Type/Grade	Origin	Location	Organic	Price (EUR/kg)	Weekly Change	Market Sentiment
Chilli dried whole	Bird eye, Grade A	IN	New Delhi	Yes	4.90	0%	Firm
Chilli dried	Powder, Grade A	IN	Andhra Pradesh	Yes	4.64	0%	Firm
Chilli dried	Flakes, Grade A	IN	Andhra Pradesh	Yes	4.60	0%	Stable
Chilli dried	With Stem	IN	Andhra Pradesh	No	2.30	0%	Stable
Chilli dried	Whole, Stemless, Grade A	IN	Andhra Pradesh	No	2.33	0%	Stable

🌍 Supply & Demand Drivers

• Vietnamese Export Recovery: May 2025 exports surged 25.8% m/m, but Jan–May volume down 82% y/y due to stricter phytosanitary checks.
• Key Export Markets: Laos leads demand (45% in May, 49% ytd), with China, South Korea, and the EU remaining active destinations.
• Asian Dominance: Asia accounts for 80% of global chili output, with India as top producer/exporter, followed by Vietnam and China.
• Global Consumption Trend: Growing preference for spicier foods, especially in the West and developed Asian economies, underpins stable demand.
• Compliance and Quality: Increased scrutiny on pesticides and residues; multiple 2023 EU/China shipments faced rejections or warnings.
• Domestic Production Initiatives: Vietnam’s 50,000 ha devoted to chili, including large-scale organic/VietGAP transitions to meet export standards.

📊 Fundamentals & Comparative Overview

Country	Annual Production (mt)	2024/25 Exports (est.)	Major Markets	Key Notes
India	Approx. 1.8 million	Top exporter	Global	Dominates global chili market
Vietnam	~600,000	2nd/3rd globally	Laos, China, S. Korea, EU	Export growth, shifting to organic
China	Est. 500,000+	Large	Asia/Europe/US	Production focused on dried/processed
Thailand	~200,000	Seasonal exports	ASEAN, Asia	Favored for seasoning

🌦️ Weather Outlook for Key Growing Regions

• Vietnam (Dak Lak/Tay Ninh/Mekong Delta): Monsoon conditions from late June bolster soil moisture but pose risk for fungal outbreaks; overall, yield outlook stable but dependent on continued rainfall moderation.
• India (Andhra Pradesh/New Delhi): Southwest monsoon active; moderate risk of flooding in central AP, but transplanting progress on track. No major disruptions as of latest update.
• China (Guangxi/Sichuan): Above-average rainfall improving early seedling establishment.

📌 Trading Outlook & Recommendations

• 🟢 Buy on Dips: Stable-to-firm sentiment due to demand recovery and steady production costs.
• 🔵 Monitor Quality Trends: Watch for developments in pesticide compliance; positive momentum likely if Vietnamese shipments clear regulatory hurdles.
• 🟡 Contracts with Certification: Emphasize VietGAP/organic sourcing—especially for EU, US, and China-bound cargos.
• 🔴 Hedge for Volatility: Consider price protection tools amid supply chain/weather uncertainties in AP and Mekong regions.
• 📅 Watch Monsoon Impacts: July–August weather to set short-term price trajectory, particularly if heavy rains disrupt Vietnamese/Indian harvests.

📆 3-Day Regional Price Forecast

Region/Exchange	Current Price (EUR/kg)	Forecast (EUR/kg)	Trend
Delhi (IN) – Bird Eye, Organic	4.90	4.90–5.05	Firm
Andhra Pradesh (IN) – Powder, Organic	4.64	4.60–4.68	Stable/Up
Andhra Pradesh (IN) – Whole Stemless	2.33	2.33–2.40	Stable

Note: No significant pricing changes expected short-term; potential for uptick if weather risks materialize or export bottlenecks ease further.