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You are here : Home >> Spices News >> Pepper
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     Pepper
 
Pepper, known as the black gold, is an important commodity traded globally since ancient times. A native of the Western Ghats, the fame of pepper brought traders from all over the world to the shores of the southern Indian state of Kerala throughout history. Kerala still accounts for over 90 percent of India’s pepper output. Karnataka and Tamil Nadu is the other pepper producing states in India.

Global Output

Global pepper production is estimated between 300,000-330,000 ton per year. Vietnam, India, Indonesia, Malaysia, Brazil, Sri Lanka, China and Ecuador are the main pepper producing countries in the world. In 2005, the global pepper production was estimated to be around 314,000 ton, down 3 percent compared to the same period a year ago. International Pepper Community, an apex body of major pepper producing countries in the world, has placed global pepper output in 2006 at 274,000 ton.

Global Demand

Global pepper demand in terms of export is estimated between 200,000-225,000 ton per year. The main suppliers to the global market are Vietnam, India, Indonesia and Brazil. Major destinations of pepper export are the US, Europe, Japan and Australia.

Indian Output

India was the largest pepper producer and exporter in the world till the 1990s. Vietnam emerged as the major pepper producer and exporter by the turn of last century and dislodged India’s leadership in global pepper trade. The total output in India during 2005-06 was estimated at 45,000-50,000, 35 percent down compared with the previous year. In 2006-07, the production of pepper is estimated to be lower than that of the same period a year ago due to adverse climatic conditions and diseases to pepper vines in major production centres.

Price Formation

As a highly traded commodity, global demand and supply plays a crucial role in shaping pepper prices. Vietnam, a new entrant to pepper crop, sharply raised the total global supply by over 100,000 ton by early years of 2000 led to a crash in pepper prices globally. Indian pepper costing over Rupees 200 per 1 kg in 2000 fell to an average of less than Rupees 65 per 1 kg by 2005. The price seems to be firming up in this year due to the overall decline in global pepper production. New York and Rotterdam are the main global centres of pepper trade. Malabar Grade 1, Lampung, Sarawak and Vietnam are the major names in global pepper trade parlance.

Crop Season & Markets

The main season of pepper harvests in India is between January-March. The main physical markets of pepper in India are Sulthan Batherry and Kalpetta in Wayanad and Kochi in Kerala. Apart from the physical markets, pepper is one of the important commodities now traded in futures exchanges in the country.

Domestic Market

India is rated as the highest pepper consuming country in the world. Though demand for pepper exists throughout the year, a surge is noticeable during the winter months.

Export

The share of India in global pepper export has declined to less than 10 percent during the last three years. The main factor for this drop is the competition from Vietnam. Though the share of India in raw pepper export has declined, India is the major producer of pepper oleoresin and pepper oil in the world. Nearly 90 percent of global pepper oleoresin is produced in India. Indian manufacturers are also turning themselves to be key players in grounded pepper exports.

Pepper output in India (in ton)

                                                           2004-05                              2005-06

Kerala                                                 66,620                                 42,900
Karnataka                                             2,350                                   1,525
Tamil Nadu                                              910                                      500
Andamans                                                120                                        75

Total                                                      70,000                                45,000
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