Vietnam exported about 188,000 tonnes of pepper worth US$1.27 billion in the first nine months of 2025, down 6.3% in volume but up 28.7% in value year on year, according to the Ministry of Industry and Trade. The average export price reached US$6,774 per tonne, up 37% from 2024.

The strong export performance came despite a volatile year for global pepper markets.

According to the Vietnam Commodity Exchange (MXV), domestic prices doubled or even tripled in 2024, peaking at VND180,000 per kilo (US$6.92) - the highest level in a decade.

The Vietnam Pepper and Spice Association (VPSA) said average prices rose 70% in the first half of 2024, driven by global supply shortages as major producers like Vietnam, Brazil, India and Indonesia all suffered 10-20% output declines due to extreme weather.

Disruptions in the Red Sea and Suez Canal further raised logistics costs, while global consumption continued to grow 3-4% annually, especially in India, the Middle East and Europe.

Vietnam remains the world’s top supplier, accounting for 35-40% of output and over half of export value. Despite a smaller cultivation area of about 110,500 hectares, productivity has nearly doubled the global average, sustaining output at around 200,000 tonnes in 2024.

In 2025, total production is projected to drop to 180,000 tonnes under the impact of El Nino.

Another factor keeping prices high is a US trade policy that imposes a 40% tariff on goods shipped through third countries, prompting Vietnamese exporters to reduce imports of raw pepper from Brazil and buy more from local farmers instead.

Nguyen Duc Dung, deputy general director of the Vietnam Commodity Exchange, said pepper prices were likely to stay around VND150,000–151,000 per kilo until year-end and could approach VND155,000 if supply tightens further.

However, a sharp rally like mid-2024 was unlikely to return as speculative funds had shifted to other commodities such as coffee.

Although pepper prices remained high, the industry still faced challenges from a strong US dollar, tight monetary policies and stricter quality standards from the EU and US, which would raise costs and narrow profit margins.

Analysts say the current high-price period offers a chance for Vietnam’s pepper sector to upgrade processing, diversify export markets and build a stronger national brand for long-term growth.

Source: VOV