Pepper Exporting Countries And Their Competitive Advantages

As a spice wholesaler, you must understand your sourcing options and each pepper exporting country’s advantages. We’ll look at Vietnam, Brazil, Indonesia, and India, the top pepper exporters, and compare their quality, quantity, price, and logistics. We’ll also discuss sourcing from each country’s risks and mitigation strategies. Different exporting countries can provide high-quality pepper, large volumes at low prices, or efficient logistics. Knowing each exporting country’s competitive advantages and risks helps you choose suppliers and build trust. Let’s examine pepper-exporting nations and their advantages to find the best sourcing options for your business.

1. Current situations about world’s largest pepper exporting countries

Although the wholesale of pepper in most of the countries around the world has improved compared to the previous months, the pepper market still has to face many difficulties and challenges.

• According to statistics from IPC, the total pepper exports worldwide in 2020 are higher than ever, reaching 498931 tons, up 3.8% compared to that of 2019. However, pepper exports worldwide, especially in largest pepper exporting countries, tend to decrease due to the impact of the COVID-19 pandemic with a decrease of 1.4% in 2021. It is predicted that the highest exporting countries of pepper will continue to decrease due to the impact of the global economic recession especially in important markets such as the EU and the US.
• Up to 8/2022, Vietnam has still been the first among pepper leading exporting country in the world with a pepper production of 160891 tons; however, this figure has decreased by 18.6% compared to the last same period. Similarly, major pepper exporting countries such as Brazil and Indonesia also saw their pepper exports decrease by 7.4% and 12.5% respectively.

2. Top largest pepper exporting countries in the world

Each pepper exporting country in the world has different characteristics in the production and export of the wholesale pepper.

2.1. Vietnam world’s largest pepper exporting countries

Over the years, the pepper wholesale market in Vietnam has always shown its strengths in both quantity and quality as it is the largest exporter of pepper in the world.

• Vietnam is still the world’s largest pepper producing and pepper exporting country. In 2022, accumulated to the end of October, the pepper exporting volume reached a total of 192076 tons, worth 836.9 million USD, fell 16.3% (equivalent to 37,509 tons) in volume but rose 5.79% (45.8 tons) in value over the same period last year.
• The reason why Vietnam has become the leader among largest pepper exporting countries in the wholesale pepper market is that Vietnam is geographically located in the tropical monsoon humid region, suitable for strong pepper development. As a result, pepper wholesalers with raw material areas are increasingly expanding their business thanks to the expansion of pepper growing areas. Currently, the pepper growing area in Vietnam is about 130000 ha.
• Vietnam is one of the pepper exporting countries with the cheaper wholesale price of pepper, about 3150 – 3250 USD/ton, just over the pepper price of Brazil because Vietnam can produce a large amount of pepper, the supply is abundant, the more you buy, the cheaper the price is, and the labor cost in Vietnam is also cheaper than in other countries.
• The quality of Vietnam peppers meets international export standards with large, firm, spicy and aromatic seeds thanks to being grown in fertile basalt red soil with farming and processing applying modern machinery technology.
• Currently, the US continues to be Vietnam’s leading exporting countries market with 48598 tons, but compared to the same period decreased by 3.9%, followed by countries such as China, UAE, India, Germany, Netherlands…

2.2. Brazil world’s largest pepper exporting countries

Currently, the pepper of Brazil is increasingly chosen by the largest pepper-importing countries in the world for their trade wholesale. How about seeing the reasons why for this with the information below.

• In 2021, Brazil’s pepper exports broke a new record of 92.1 thousand tons, equivalent to 306.3 million USD, up 2.6% in volume and 65.3% in value over the previous year.
• In August 2022, Brazil’s pepper exports climbed substantially by 43.9% over the same period last year and by 4.2% over the preceding month, to 6010 tons. Thus, Brazil’s total pepper exports in 8 months were raised to 51701 tons, worth more than 204.25 million USD.
• In the last months of 2022, while the world’s largest pepper exporting countries including Vietnam, pepper prices gradually decreased, pepper prices in Brazil tended to increase. The reason is that before the pepper price in Brazil was quite competitive, many wholesalers switched to importing Brazilian pepper.
• The quality of Brazil’s pepper is said to be good among other pepper exporting country, with 80% of the volume sold on the world market reaching organic standards, as Brazil also has a geographical advantage with low-lying lands, year-round rainfall and humid winters. The climate is suitable for the development of pepper cultivation.
• Pepper from Brazil is consumed in many countries around the world, in which Germany still holds the top position as the largest consumer of Brazilian pepper, accounting for more than 15% of the total with 13552 tons, up 2% compared to 2020.

2.3. Indonesia world’s largest pepper exporting countries

While Vietnam and Brazil have the advantage of exporting black pepper, Indonesia has the advantage of exporting white pepper. White pepper exports in Indonesia account for about 47% of the world’s pepper exports.

• Indonesia used to be in second place among highest pepper exporting country of the wholesale pepper worldwide, but in recent years it has fallen to third place in the world, despite owning the largest pepper growing area in the world. The reason for this is that pepper productivity in Indonesia is still low, so there is not much pepper output. Pepper grains of Indonesia are mainly produced by small household farmers, so the pepper production is still in backward conditions, with the poor development of technology, especially the post-harvest and processing technology.
• The price of black pepper in Indonesia is the second highest among world’s largest pepper exporting countries, about $3806/ton for black pepper and $5995/ton for white pepper, just behind the price of pepper in Malaysia. These price levels are quite competitive in the wholesale pepper business because Indonesia has the advantage of the cheaper freight rates. Therefore, many wholesalers have decided to move from the Vietnamese pepper market to Indonesia.
• Some of the main countries that Indonesia exports pepper to are the US, Australia, the Netherlands, Belgium, Bulgaria, Hong Kong, India…

3. Price comparison of pepper exporting countries

Each country has different export prices. Shall we take into consideration how pepper prices in each country fluctuate by the following comparison table.

Country	Black pepper	White pepper
Vietnam	3150 – 3250	3250
Brazil	2625
Indonesia	3806	5995

• By the end of November 2022, pepper prices in most of the countries all over the world have had a tendency to decline, compared to the previous months. We will look at the reasons for this later.

• Currently, Brazil’s black pepper price is the cheapest among pepper exporting countries thanks to a large supply of pepper. Besides, unlike countries like Vietnam or Indonesia, Brazil’s export price of pepper tends to increase in the last months of the year thanks to competitive prices and cheaper freight, which makes pepper importers switch to buy pepper from Brazil. Indonesia is the country with the highest pepper price in the three countries under consideration, although Indonesia’s pepper exports are only ranked third. Vietnam, the world’s largest exporter of pepper, has a mid-range pepper price.

4. Main factors affect wholesale trade of pepper exporting countries

We have mentioned the export price of pepper and compared the prices of the largest pepper exporting countries in the world above. Now, we will go to find out what factors affect the export price of pepper in countries around the world.

4.1. The law of supply and demand affects pepper prices of highest exporting countries

The law of supply and demand has an impact on the market economy in general and the pepper trade in the world’s largest pepper exporting countries in particular.

	2017	2018	2019	2020	2021
Vietnam	200000	230000	260000	240000	180000
Indonesia	70000	73000	78000	77000	79000
Brazil	65000	72000	80000	95000	90000

Pepper production per year by countries (MT)

• When the supply of pepper on the market is not enough to meet the needs, the price of pepper will climb.
• When the demand in the wholesale pepper market decreases, which gives rise to the surplus, the price of pepper will drop.

4.2. Price affects pepper prices of highest exporting countries

The wholesalers of pepper pay close attention to the price because it is one of the most important variables in the wholesale market.

• The wholesale price has an impact on the export and import in the pepper wholesale market in pepper exporting countries. Because the export price of Brazilian pepper is less expensive due to lower freight expenses, this results in a tendency for a portion of Vietnam’s pepper export market share to transfer to Brazil.
• In September 2022, export prices of black and white pepper varied widely among pepper exporting country that produced them, rising in Indonesia, remaining stable in Malaysia, but falling in Vietnam and Brazil.

Essential knowledge for your business that you have to read carefully:

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Black Pepper Exporters And Some Critical Details You Must Know

4.3. Worldwide fluctuations affect pepper prices of highest exporting countries

The worldwide pepper market is also impacted by the various economic, political, and social conditions in each nation.

• China is going through a real estate crisis, and the government’s decision to retain the Zero Covid policy in response to the Covid-19 epidemic triggered by a new variant has prevented the short-term growth of the pepper market in the pepper exporting countries that export peppers.
• People tend to cut back on spending, which puts more pressure on pricing. Political unrest in Eastern Europe has resulted in high energy prices and inflation.
• Despite being in default, Sri Lanka will increase pepper exports and prices may be more affordable than in other nations.