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Weak int’l demand prunes peppercorn exports

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Farmers harvest pepper in Ratanakkiri province in July 2020. Post Staff

Weak int’l demand prunes peppercorn exports

Cambodian peppercorn exports plummeted nearly three-quarters in the first 10 months of 2022 from a year earlier, according to the agriculture ministry, a downturn that producers have pinned on low demand despite falling prices for the locally-grown spice, which has been tied to economic drag from the Ukraine conflict, a weakening euro against the greenback and other exchange rate fluctuations.

In the January-October period, peppercorn exports reached 7,704.25 tonnes, marking a 72.12 per cent year-on-year decline from 27,633.77 tonnes, with Vietnam buying the lion’s share at 6,645.78 tonnes or 86.26 per cent, the Ministry of Agriculture, Forestry and Fisheries reported.

Other destinations included Germany (928.20 tonnes), the US (26.10 tonnes), Taiwan (21 tonnes), France (19.68 tonnes), Belgium (18.67 tonnes), Malaysia (14.24 tonnes), the Czech Republic (11.30 tonnes), South Korea (7.26 tonnes), Japan (3.03 tonnes), Sweden (2.78 tonnes), Switzerland (2.12 tonnes), Canada (1.28 tonnes), the UK (one tonne), India (0.92 tonnes), Lithuania (0.45 tonnes), Kazakhstan (0.3 tonnes), Australia (0.10 tonnes), Russia (0.03 tonnes) and the Netherlands (0.01 tonnes).

Using previously reported ministry data for reference, this means that just 369 tonnes were exported in the September-October period alone, down 87 per cent year-on-year from nearly 2.8 kilotonnes.

Each year, peppercorn – the fruit of the Piper nigrum, a flowering vine considered to be native to the southwestern Indian coast – is typically harvested exclusively by hand between January and June, generally wrapping up when the southwest monsoon brings the rainy season from mid-May.

Among the varieties cultivated in the Kingdom, Kampot pepper is the most highly-prized, grown in the namesake coastal province, and remains the sole cultivar protected under national geographical indication (GI). The Kampot Pepper Promotion Association (KPPA) is in charge of managing this GI.

KPPA president Nguon Lay told The Post on November 21 that the cultivation area and output of Kampot pepper in 2022 have remained similar to 2021 levels, but that year-to-date exports of the cherished variety stand at 65 tonnes, falling by “more than 50 per cent” year-on-year, leaving stocks higher than in the same time in 2021.

He blamed the sharp drop in peppercorn sales abroad on slowing global economic growth, the Ukraine crisis and the weakening euro against the US dollar, noting that Kampot pepper in particular has a large European client base.

“However, since Kampot pepper is a GI product, I’m not worried about the market, there may just be a delay for some buyers.

“With regard to the increased amount of Kampot pepper in stock on-year, orders have already been placed for some of it,” Lay said, noting that it is common for the variety to be harvested until as late as end-July.

The per-kilogramme prices for this type of peppercorn have remained the same for several years, at $15 for black, $25 for red and $28 for white, according to Lay.

Similarly, Cambodian Pepper and Spices Federation (CPSF) president Mak Ny ascribed the decrease in peppercorn exports to a decline in foreign orders he tied to the global economic crisis, which he argued has slashed prices for the spice to an average of 11,000 riel ($2.64) per kilogramme for regular varieties, sliding down from 15,000-16,000 riel in the year-ago period.

“Price and demand issues have led to a sharp drop in pepper exports this year. However, we hope it’ll be back on the markets next year,” he said.

Ny said the total area under pepper cultivation is estimated at roughly 6,000ha nationwide, with significant quantities grown in 18 of the Kingdom’s 24 provinces, notably Tbong Khmum, Mondulkiri and Ratanakkiri.

Meanwhile, a newly-signed document marking a major step towards the export of Cambodian peppercorn to China has sparked optimism among agricultural players for meaningful improvements in the production and international sales of the dried fruit, as well as related investment.

The “Protocol of Phytosanitary Requirements for Export of Peppercorns from Cambodia to China” was penned at the Peace Palace on November 9 by Minister of Agriculture, Forestry and Fisheries Dith Tina and General Administration of Customs of China (GACC) head Yu Jianhua at a ceremony presided over by Prime Minister Hun Sen.

In a previous interview with The Post regarding the document, Centre for Policy Studies (CPS) director Chan Sophal commented that official direct exports to China would effectively end Cambodia’s reliance on Vietnam or other nearby countries for bringing its peppercorn to the Chinese market, historic relationships he stressed have had their disadvantages.

“With this protocol signed, I hope that the official export of pepper to China happens soon,” he said, adding that Beijing spent “at least two or three years” studying the details of the document.

In the next step, costs associated with direct shipping from Cambodia to China will need to be analysed, Sophal said.

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