For many years now, the world’s agricultural traders have known Vietnam as the number one pepper supplier in the world. Vietnam pepper with guaranteed quality, meeting the requirements of importers, increasingly asserts its position on the world map.
Vietnam pepper: Overview
The definition and characteristics of Vietnam pepper help Vietnam consider it as the leading exporter of pepper all around the world.
The definition of Vietnam pepper
Vietnam pepper is a pepper product that is harvested and processed in Vietnam. The average annual output of Vietnam pepper is about 250,000 tons, the average export value is over 3000 USD/ton.
Types of Vietnam pepper and its characteristics
In the cooking dictionary, the most popular are 5 main types of pepper: black pepper, white pepper, ground pepper, red pepper, green pepper.
- Black pepper – the main produced pepper: Black pepper is the most familiar and commonly used in Vietnamese peppers. To get this type of black pepper, the farmer must pick the fruit when the pepper plant appears some red or yellow on the bunch ( about 5% of the ripe fruit) when the pepper is still green. The young fruits without a hard skull are often very brittle, when dried, they are easily broken, other fruits when dried, the skin will harden and turn black, we get black pepper. Black pepper is the product produced in the largest quantity, accounting for about 70% of Vietnam pepper production. Black pepper is a somewhat spicy spice with a faint aroma that is frequently used to enhance a meal’s peppery and warm flavor. Black pepper is frequently used as a medicine or a treatment to alleviate ailments such as coughs, sore throats, and colds.
- Skull pepper (white pepper): Skull Vietnam pepper is also known as white pepper. In Vietnam, people harvest pepper when the cluster is about 20% ripe, then take other technical steps to make white pepper. Another way to make white pepper is from black pepper with the black skin removed according to increasing market demand. This type of skull pepper is ivory-white or gray-white, less wrinkled, and less fragrant because they peel, most of the spicy essential oil has been removed, but they have a more spicy taste because they are overcooked. Skull Vietnam pepper is often used to create an aroma for luxurious menus without losing the aesthetics and color of the dish because of the black shell. In European dishes that use milk or cream ingredients as a base, the chef will prefer to use ground pepper or ground pepper to match the color with the milk cream.
- Ground pepper: Ground pepper is ground pepper that is ground from black or white pepper. Pepper powder is a spice component in dishes that helps to make them more appealing and tasty. In Vietnam, people often use ground pepper or buy seeds to grind or grind to use.
Black pepper, white pepper, and ground pepper are types of pepper that are mainly used for export.
- Green pepper: Green pepper is a type of Vietnamese pepper that is not fully ripe and is picked the whole bunch by people when it is still green on the tree. Usually, we will choose bunches that have not yet formed peppercorns and are still soft and young to pick. Green Vietnam pepper will have a mild spicy taste and moderate aroma. The eater can eat and chew the whole pepper very easily. This is the type of consumption for domestic consumption in Vietnam. Green Vietnam pepper is often used in stews to get the flavor and hot properties of pepper as well as eliminate the smell of ingredients such as stewed beef dishes, stewed stomachs,… In addition to being a cooking ingredient, green pepper has the effect of treating colds, warming the body, enhancing immunity for the digestive system as well as increasing antioxidants for the body.
- Red pepper (pink pepper): Pink pepper, also known as red pepper, is a small Vietnam pepper with the scientific name Schinus terebinthifolius and the English name: pink pepper. Although in Vietnam, they are called pink pepper, they are not inherently in the pepper family and are not actually pepper. The reason it is called pink pepper is that it has a spicy taste like pepper and the skin is pink or red. Pink pepper has a lot to do with medicine: they have a diuretic, laxative effect, treat the symptoms of flu, colds, coughs or bronchitis. Pink pepper has anti-inflammatory properties, used to treat gynecological diseases such as chronic vaginitis or as a remedy for menstrual disorders. However, it should be noted that pregnant women should not use pink pepper. This is a type of pepper produced very little, mainly for domestic consumption.
Vietnam pepper price
Let’s have a look at the price of Vietnam pepper in the domestic market as well as the export market.
- In the domestic market: An increase in pepper price
After Ho Chi Minh City and southern provinces eased social distancing, businesses have actively purchased raw materials, making up for the shortage of inventory for more than two years, blocked months to meet year-end orders, and delayed orders due to the impact of the COVID-19 epidemic. As a result, the price of black pepper in the Central Highlands and Southern provinces has increased sharply and reached the highest level in the past 4 years.
The price of black pepper recorded at the beginning of November 2021 in Binh Phuoc, Dak Lak & Dak Nong and Gia Lai fluctuated in the range from 86,000 – 88,500 VND/kg. In which:
|Area||The price of black pepper (VND/kg)|
|Dak Lak & Dak Nong||87,000|
|Gia Lai & Dong Nai||86,000-87,000|
With the recent strong price increase, the domestic price of pepper is now 62.3-66% higher, equivalent to an increase of 33,000-35,000 VND/kg compared to the beginning of this year and an increase of 80-83% compared to the same period last year. According to the forecast, Vietnam pepper prices will continue to increase next time due to the shortage of Vietnam pepper supply and the quick increase in demand at the end of this year.
- Vietnam pepper export markets
It is estimated that the average export price of Vietnam pepper in June 2021 and in the six months of 2021:
|June, 2021 ($/ton)||Compared to June 2020 (%)||In the first six months of 2021 ($/ton)||Compared to the same period in 2020 (%)|
|The average export price of Vietnam pepper||3,529||52,5||3,216||50,7|
It is forecasted that Vietnam pepper exports in the coming time will be quite favorable due to increased demand from partners. Due to a scarcity of peppers, prices tend to rise.
(Source: Data from the General Department of Vietnam Customs. Unit: USD/ton)
Areas where to grow Vietnam pepper
Pepper belongs to the Piperacea family, originated from India, and has been cultivated by the French in Vietnam since the 17th century.
Pepper is the main crop of our country. Currently, the total area of pepper cultivation in the country is more than 130 thousand hectares, mainly concentrated in the Southeast region and the Central Highlands with an area accounting for over 95% of the pepper growing area. of water; The rest are scattered in the North Central and Central Coast provinces. In which, the Central Highlands and the Southeast region lead in terms of area, productivity, and output. There are also additional pepper-growing regions, such as Phu Quoc (Kien Giang), which has a long-standing brand name, and the Quang Tri pepper-growing region……
The reason Vietnam pepper is grown a lot in the above areas is because the total agricultural land area of these locations is very large and includes many types of hilly soils such as red, black, gray soils to plain soils. such as alluvial soil, sandy soil. The diverse characteristics of the land have facilitated the cultivation of fruit trees and traditional industrial plants for a long time.
Competitive advantage of Vietnam pepper
Vietnam’s pepper productivity is much higher than the world average, the average yield is about 2.2 tons/ha, 4-5 tons/ha in many places, even higher, especially in some areas in Gia Lai. Pepper production has increased significantly since 1998, from 15,000 tons until now to more than 250,000 tons.
Since 2002, Vietnam has become the leader in output and the largest supplier of pepper in the world pepper market. Vietnam has 18 clean pepper processing plants, with a capacity of about 70,000 tons/year (2010), of which 14 have quite modern technology, processing pepper through steam, creating clean products reaching the highest standards. American (ASTA), European (ESA), Japanese (JSSA) standards.
In the situation that pepper prices have remained high as in recent years, the competitiveness of Vietnamese pepper is very large. This is evident when considering that the domestic resource cost (DRC) index has decreased from 0.7 in 2004 to 0.4 in 2010, a coefficient less than 1 indicates an increase in competitiveness paintings of Vietnam pepper. The coefficient of visible comparative advantage (Revealed Comparative Advantage (RCA) of Vietnam’s pepper product is much larger than that of other pepper exporting countries in the world. Based on data from the International Pepper Committee (IPC) and the Food and Agriculture Organization of the World (FAO), the coefficient of comparative advantage of Vietnam pepper products is also much larger than that of other pepper exporting countries in the world.
Although it is a dominant export industry, bringing benefits to farmers, the Government does not have a protectionist policy. Nominal protection rate NPR < 0 because domestic prices are always lower than international prices. The government still applies the 5% VAT policy on pepper products.
The above analysis shows that the competitiveness of Vietnamese pepper in the world market is very high when Vietnam’s trade market share is increasingly dominant and the world pepper price is increasing. Many types of Vietnamese pepper have quite good quality such as Phu Quoc pepper which is equivalent to Indonesian and Indian pepper, Chu Se pepper has the characteristics of gloss, large seeds, characteristic aroma, high density, and high density. reputation in the world market, including demanding markets such as the EU and the US. Pepper businesses have been able to export directly to raw material suppliers for spice processing factories in other countries.
The factors affect Vietnam pepper’s price
There are many factors that affect Vietnam pepper’s price such as supply, demand, shipment, government, and so on.
Supply of Vietnam pepper
Vietnam pepper maintains an area of 130,000 hectares with an output of 250,000 tons/year. Although the Covid-19 epidemic caused many difficulties, Vietnam pepper exports remained stable. Up to now, Vietnam pepper has been present in 110 countries and territories around the world. The volume of pepper exported by Vietnam currently accounts for 60% of the world’s pepper exports. Along with the quantity, the quality of pepper in Vietnam has also improved and the product is quite rich in black pepper, green pepper, white pepper, powdered pepper, pickled pepper.
According to estimated data of IPC, Vietnam pepper’s output in 2021 is 220,000 tons, down 8%, equivalent to 20,000 tons compared to last year’s crop. Thus, Vietnam’s output decreased not much compared to the estimate of 180,000 tons as previously forecasted by IPC, but this was the third consecutive year of decline for the Vietnam pepper industry. The shortage of pepper volume led to a shortage of pepper supply to foreign markets. This decrease also causes the price of Vietnamese pepper to increase slightly.
Demand for Vietnam pepper
Vietnam pepper is one of the most well-known spices in the world, accounting for the majority of export revenue. In which, the United States, UAE, India, Pakistan, and Germany are the main markets of Vietnam pepper.
According to the data of the third quarter of 2021, in the first nine months of this year, Vietnam’s pepper exports to most markets increased in volume and value. With 46,653 tons worth 169.6 million USD, the US is the top pepper export market, rising 9.7% in volume and 59.7% in value over the same period the previous year.
Over the same period, exports to the UAE increased by 37 percent in volume and 115.9% in value, totaling 13,615 tons worth $47.4 million. The amount of pepper exported to the Indian market climbed by 1.6 percent, 12.6 percent to Pakistan, and 20.5 percent to the Netherlands…
According to experts, buying power from major importing countries such as Europe, the U.s, China, the Middle East, and Africa… remains strong, owing to a surge in orders in the fourth quarter to meet year-end demand. Meanwhile, because this year’s pepper harvest failed, forcing production to fall, Vietnam’s export supply has shrunk. Furthermore, because supply from the primary manufacturing countries was not as plentiful as in past years, the volume of imported items reduced dramatically. As a result of these reasons, Vietnam pepper prices are likely to continue to rise, reaching a high of VND 100,000/kg by the end of the year.
Logistics: Sea freight rates show signs of cooling down
Freight prices from Asia to the United States have been on the decline in recent weeks, according to statistics from consultancy firm Drewry World. Global sea freight prices have begun to decline, which is excellent news for the Vietnam pepper industry, as growing freight charges have had a substantial impact on export enterprises in recent years. The Vietnam Pepper Association (VPA) stated at the start of the third quarter of this year that shipping freight costs were too high, putting pepper exporters at risk of losing clients or perhaps going bankrupt. The port was overburdened with goods, and export commitments could not be fulfilled because freight rates were too high.
The freight rates create favorable conditions for pepper exporters and reduce costs for customers importing Vietnamese pepper.
Policies of importing countries
The largest market for Vietnam pepper is the United States, which accounts for 20-25 percent of annual export volume and has historically maintained constant purchasing power. Furthermore, the EU is a crucial market and a target market for most enterprises in the context of free trade agreements aimed at increasing this market’s purchasing power. Pepper exports to the EU, on the other hand, face numerous challenges due to stringent food safety regulations. This has a significant impact on Vietnam pepper exports to this market. Furthermore, Vietnam has negotiated numerous trade agreements with other nations throughout the world, laying the groundwork for the expansion of Vietnam’s pepper export markets. Due to the preferential tariffs from trade agreements, the export price of pepper to these markets will be lower than in areas that do not sign trade agreements.
Steps to work effectively with Vietnam pepper suppliers
Buyers or importers need to pay attention to steps in the process of working with Vietnam pepper suppliers:
- Step 1: Buyer sends the letter of intent
- Step 2: Seller replies with official FCO
- Step 3: Discuss the terms in FCO
- Step 4: Agree with the final FCO
- Step 5: Send draft contract
- Step 6: Discuss and finish the contract
- Step 7: Send a sample for testing (optional)
- Step 8: Payment instrument
- Step 9: Loading goods and sending the documents
Because of the large value of orders, both customers and sellers should ensure that the transaction process is transparent, straightforward, and convenient, laying the groundwork for future transactions.
Main Vietnam pepper suppliers
Choosing types of pepper with high quality will help buyers be assured of quality when using as well as selling to others. Therefore, choosing a reputable pepper supplier is also a question that many buyers are most interested in. This is a list of 3 the best Vietnam pepper suppliers:
K-Agriculture, located in Hanoi-Vietnam, is one of the reputable suppliers with 25-year experience in exporting agricultural goods including rice, coffee…, especially many types of pepper to many fastidious markets. Its main pepper export markets are Africa, the USA, and Japan.. Supported by the Ministry of Industry and Trade, K-Agriculture has brought the best Vietnamese agricultural products to the international market. Working with the slogan “Quality is King”, K-Agriculture always guarantees the best quality products at the most competitive price. The company has already got many certificates such as HACCP, ISO 9000, or FSSC 22000.
For more information, contact us:
Phone/Whatsapp: +84855 555 837
Conamo Vietnam Co., Ltd.
As a manufacturer and distributor of condiments: roasted sesame sauce, roasted sesame sauce, chili lime salt, tamarind juice, barbecue sauce, apricot salt, Tay Ninh shrimp salt, coconut oil color juice, ground pepper, ground pepper, other traditional spice products… In order to meet the fastidious needs of customers, Conamo Vietnam Co., Ltd. focuses on product quality, best price, … Our desire is to ensure the interests of consumers in a way best. A clear business strategy and a reputable distributor are what make CONAMO build trust from distributors.
Vietnam PHL Pepper
With many years of experience in exporting all kinds of pepper including red pepper, white pepper, black pepper. With a modern, closed production system, ensuring hygiene and quality, with large, uniform peppercorns and distinctive aroma, PHL always gives customers confidence when ordering and using products. The export pepper markets of PHL: India, Korea, Europe,…
Pepper is one of the export commodities that play an important role in the Vietnamese economy. Vietnam pepper has created a global Vietnamese spice brand all over the world, contributing to bringing Vietnam higher and higher in the international market.