Black pepper prices may rise only after curbs on cheap imports

26-May-2025 03:58 PM

Kochi. Black pepper production in Sri Lanka is rapidly increasing, aided by strong exports to the vast Indian market. The supply of new produce from Sri Lanka is expected to begin next month, raising concerns among Indian producers and traders.

Large quantities of duty-free imports under the bilateral trade treaty with Sri Lanka may put additional pressure on Indian black pepper prices, as Sri Lanka is leveraging the agreement to export substantial volumes to India without customs duty.

Meanwhile, in India, the harvesting and post-harvest processes of the new black pepper crop in Kerala and Tamil Nadu are either complete or nearing completion. However, new crop arrivals are still ongoing in Karnataka.

Domestic production for the 2024–25 season is expected to fall sharply due to adverse weather conditions. Despite this, previous stock and cheap imports from countries like Sri Lanka and Vietnam are expected to keep the overall domestic supply situation relatively stable.

According to data from the Spices Board, India's pepper exports rose to 19,055 tonnes in the first 11 months of the last financial year (April 2024 to February 2025), up from 16,126 tonnes during the same period in 2023–24. Export earnings also increased from Rs 664.25 crore to Rs 950.10 crore during this time.

Despite lower-than-expected arrivals in major producing countries, there is moderate demand from stockists, exporters, and spice-processing companies producing oleoresin, oils, and powders.

This demand has created a stable pricing environment. However, with the new crop still some time away and domestic production down, any successful move to limit imports in the coming months could lead to a rise in black pepper prices.