On December 21, in Ho Chi Minh city, the Vietnam Pepper Association (VPA) organized a seminar “Promoting exports of Vietnamese pepper and spices under the EVFTA Agreement”.
According to the VPA, by the end of November 2022, Vietnam exported more than 212,000 tonnes of pepper of all kinds, with a turnover of 950 million USD. Compared to the same period last year, exports decreased by 15%, equal to more than 37,000 tonnes, but turnover increased by 4%, worth 34 million USD.
It is estimated that in the whole year 2022, the export turnover of pepper has not reached 1 billion USD as in previous years. This is due to the objective factor that the world economy is deteriorating in many key markets. Difficulties in exporting causes the price of raw pepper in Vietnam to decrease continuously. In addition, the increased cost of fertilizers makes it more difficult for pepper growers.
At present, the 2023 pepper harvest is starting in some districts in Dak Nong and after the Tet holiday, it will enter the peak time, and the production is expected to increase slightly compared to 2023. (Photo: Internet)
According to Mrs. Hoang Thi Lien, VPA Chairman, one of the positive factors in pepper exports in 2022 is that Vietnam has signed a free trade agreement with Europe (EVFTA). Thus, pepper exports to this market have many advantages of a 0% tax rate compared to other competitors such as India, Malaysia, Sri Lanka, or Cambodia.
However, the biggest challenge for this market is that the technical and product quality regulations are constantly changing in an increasingly strict way. Therefore, businesses and farmers (cooperatives) need to be closely associated with each other in production to create stable and sustainable raw materials that meet the requirements of the market.
“In 2023, after the opening of the Chinese market after the pandemic and the recovery of the pepper market in general, Vietnamese pepper exports are expected to return to the list of billion USD crops,” Mrs. Lien said.
In a close-up view, Mrs. Nguyen Nhat Minh, a representative of Vietnam Insight Company, assessed that in 2022, Vietnam remains the largest exporter of pepper in the world but in Germany, the largest importer and distributor of pepper in Europe, Brazil’s pepper still dominates with 43% market share, while Vietnam is 38%. German companies mainly import pepper for milling then packaging and re-export at a rate of up to about 50% of the total amount of imported pepper.
Mrs. Minh said that the German and the EU markets as a whole are aiming for high-quality and organic pepper products. This is something that Vietnamese exporters need to pay attention to. In order to better access the market, Vietnamese enterprises need to actively participate in specialized international fairs and international spice associations.
Mr. Luong Phuoc Vinh, Regional Director for Southeast Asia of Tentamus Group, said: The standards of European regulators have been higher than the common ground of many markets and in fact, bringing goods into their supermarket systems is more difficult. For example, if a certain chemical residue of the EU authorities is 0.1%, the supermarket system only allows 0.07%. This is what Vietnamese exporters need to be aware of if they want to access this market further./.