Rebound in second-half pepper exports predicted due to increased prices
Vietnam's pepper exports are expected to bounce back in the second half of this year, according to the Việt Nam Pepper and Spice Association. The recovery is attributed to improving global demand and potential changes in US tax policies.
Hoàn Thị Liên, the association's President, expects a rebound in exports to start from August. Despite a decrease in quantity, the export value increased by 34.1% to US$850.5 million in the first six months of this year, thanks to record-high pepper export prices.
In the first half of the year, Vietnam exported 124,133 tonnes of pepper, down 12.9% year-on-year. However, the average price for black pepper was $6,665 per tonne, up 93.6%, and the average price for white pepper was $8,079 per tonne, up 63%.
Steady or increasing demand from key markets like China, India, the UAE, and Germany is expected to support the export recovery. While U.S. demand dropped in early 2025, China is expected to increase imports in the second half of the year, albeit at a slower pace than the prior year. Exports to markets like India, UAE, and Germany remain stable.
The tight global pepper supply, driven by limited production from countries like Indonesia, Brazil, and India due to droughts or seasonal slowdowns, has contributed to higher prices and incentivized Vietnam's export recovery. New crops from Brazil and Indonesia will only start impacting the market in late 2025 or 2026, maintaining supply tightness in the near term.
Enhancements in product quality and deeper processing add value to Vietnamese pepper, which supports export recovery and higher revenues. The association anticipates positive developments in US tax policy and improvements in global demand towards the year-end.
However, exporters remain cautious due to potential tariffs and economic factors, which may temporarily slow volume growth but keep prices high. Competition from other producers like Indonesia will also pose challenges.
Pepper cultivation in Vietnam has dropped significantly due to farmers shifting to more lucrative crops like durian and coffee. The association expects a clearer tax policy for agricultural exports to facilitate trade. The predicted harvest for 2025 is estimated to be 180,000 tonnes, which is 10,000 tonnes lower than last year.
Renewed global demand will drive exports for the rest of 2025, according to the association. The association expects a clearer tax policy for agricultural exports to facilitate trade and support the recovery of Vietnam's pepper exports.
- The Association anticipates positive developments in US tax policy, which could further boost Vietnam's pepper exports.
- Enhancements in product quality and deeper processing have added value to Vietnamese pepper, supporting the export recovery and higher revenues in the business and finance sectors.
- Steady or increasing demand from key markets, such as China, India, the UAE, and Germany, coupled with potential changes in US tax policies, could contribute to the war on downturn in Vietnam's pepper exports in the second half of this year, influencing trade dynamics.
