Trade pattern (Pepper)

Global production

The world production was 2.94 lakh tonnes in 2005. Vietnam was the leading producer with 31 percent share followed by India (24%), Brazil (12%), Indonesia (12%), Malaysia (6%) and China (5%). While Vietnam exports over 95% of its production, India exports only 23% of its production. The following pie diagram shows the world production of black pepper during 2005.

Source: Pepper News & Market Review, November 2005, p.8.

Global export

Pepper neither crushed nor ground

The world export of pepper, neither crushed nor ground was 2.41 lakh tonnes in 2005. While Vietnam accounted for 37.79%. Indonesia and Brazil contributed 14.15% and 9.65% respectively. India’s share was only 5.27%. Due to emergence of Vietnam as a major producer and exporter, Indian exports declined significantly during the current decade. Another factor was the declining price competitiveness of Indian pepper in relation to her competitors especially the Vietnam. The following table shows the leading exporters of black pepper in the world during 2005.

Country-wise export of pepper, neither crushed nor ground in the world during 2005

The following pie diagram shows the export of pepper, neither crushed nor ground by country of orgin during 2005.

Pepper, crushed nor ground

The world export of pepper, crushed nor ground was 37,895 MT in 2005. While India accounted for 23.13 percent. Germany and Vietnam contributed 12.85% and 10.02% respectively. Other important exporters were USA (8.39%), Netherlands (7.79%), Brazil (6.20%), Thailand (3.17%), Malaysia (3.16%), Singapore (2.94%) and China (1.79%).

Country-wise export of pepper, crushed nor ground by country of orgin during 2005

The following pie diagram shows the export of pepper, crushed nor ground by country of orgin during 2005.

India's export

India's pepper exports declined from 46,942 tonnes in 1996 to 35,114 tonnes in 1999, the year prior to the commencement of Indo-Sri Lankan FTA and emergence of Vietnam as a major producer and exporter. The highest export value was also realized in 1999 at Rs 703.25 crores which plummeted to Rs. 140.5 crores in 2004-05 along with steep decline in quantity from 35,114 tonnes to 15,800.

However, there was significant improvement in exports during 2005-06. Export rose to 28,750 tonnes in 2006-07 which brought an export revenue of Rs. 306.20 crores.

The following table shows the pattern of export of pepper from India during the period 1996-97 to 2006-07.

Pepper exports from India since 1996-97

The following bar chart shows the decline in export of pepper from India during 1996-97 to 2006-07.

One of the major problems faced in pepper export was the steady decline in the FOB values of pepper from Rs 200 in 1999-00 to approximately Rs. 86 in 2002-03. The unit price was almost stagnant during the period 2002-03 to 2005-06 which revolved around Rs. 87 per kg. However 2006-07 witnessed a recovery in pepper price which rose to Rs 106.50 per kg. The pattern of year-wise movement is depicted in the following bar chart.

Export of pepper and pepper products from India

One of the notable features of India’s export of pepper is the steady decline in the share of pepper in primary form and increase in the share of value added products. There are three major products in primary form consisting of black and white pepper and pepper pinheads.  The share of primary products in total pepper exports declined from 72.69% to 46.47% of the quantity (from 16,493 tonnes to 7,141 tonnes) between 2002-03 and 2004-05.  Corresponding reduction in value terms was from 52.22% to 30.30% (from Rs. 134 crores to Rs. 57 crores). The volume of black pepper exports declined from 15,641 to 6684 tonnes between 2002-03 and 2004-05. In volume terms, the share of black pepper declined from 69.04 to 43.49%. But in value terms, the decline was from 50.12 to 28.37%. The following table shows the export of pepper and pepper products from India during 2002-03 to 2004-05.

At the same time, the share of value added products excluding extracts doubled during this period both in quantity and value terms.  While the proportion of quantity rose from 22.68% to 45.60% (from 5,139 to 7,009 tonnes), share of export value went up from 17.59% to 33.73% (from Rs.45 to Rs. 64 crores).  However, the increase in the share of pepper oil and oleoresins was only modest.  while the quantity of exports increased from 4.63% to 7.93%, share of export value rose from 30.20% to 35.97%. This was in spite of fall in unit value in 2004-05.

Export of pepper and pepper products from India