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Cheap Vietnamese imports rob pepper of flavour

KOCHI, SEPTEMBER 11:The uptrend in pepper prices witnessed last month, following incessant rains impacting the crop in Kerala and Karnataka, appears to have been short-lived.

Pepper prices in Kochi, which moved up from ₹340-350 per kg in mid-July to around ₹410-413 late in August, have now dropped and are hovering between ₹365 and ₹390, depending on the quality.

Pepper growers and the trade attribute this weakening trend to the surge in imports of the spice from Vietnam, both through official and unofficial routes.

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Kishore Shamji of the Kochi-based Kishore Spices cited the cheap availability of Vietnam pepper imported via Sri Lanka through the ports of Krishnapattinam, Tuticorin, Chennai, Nava Sheva and Mundra as the reasons for the price drop.

At the same time, Shamji alleged that North Indian markets such as Indore, Gwalior, Jaipur, Patna, Ranchi and Delhi have been flooded with cheap Vietnamese pepper smuggled through the Myanmar, Bangladesh and Nepal borders in cash-and-carry mode to evade GST.

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Quoting Vietnam Pepper Association figures, Shamji said that 6,800 tonnes of pepper have come to India through these unofficial channels in the January-July period, whereas India officially imported 13,000 tonnes during this period from Vietnam alone. The US imported 27,000 tonnes and China, 22,000 tonnes.

Shamji pointed out that the landing cost of Vietnam pepper is at present ₹310 compared to the Minimum Import Price of ₹500. Shamji wondered why spices exporters were depending on imports at a time when local prices are below the MIP, at ₹375/kg.

“It is common logic that the prices would have moved up given the lower pepper production in the domestic market. But this is not happening now — maybe because of higher imports,” said PT Joseph of Tropical Plantations, Vandiperiyar.

There is a major drop in production as the recent floods have affected the crop badly in the producing centres of Wayanad, and Idukki, forcing pepper spikes to fall off the vines.

Besides, the incessant rains in recent weeks have also impacted the crop in the key growing areas of Kodagu, Chikmagalur, Dakshina Kannada and Hassan districts of Karnataka, the largest producer of pepper.

KK Vishwanath, co-ordinator of the Consortium of Black Pepper Growers Organisations, put the loss of pepper in the recent deluge at an approximate 25,000 tonnes, valued at around ₹100 crore.

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Though these are unconfirmed estimates, the Spices Board has called for a meeting of all sections of the pepper trade, including farmers, tomorrow at Kochi. “It is difficult to arrive at a total acreage loss at this juncture because the approach to the interiors of all farming areas is difficult,” said Shamji.

The crop was expected to be better in 2019, but the deluge has hit those prospects with production expected to drop by 30-50 per cent (production in December 2018 stood at 65,000 tonnes).

Source: BusinessLine

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