The global pepper market is forecast to face a supply shortfall nextyear which will certainly drive prices up, so local traders should nothastily sign contracts with buyers to avoid losses, Saigon Times dailyon October 29 quoted the Vietnam Pepper Association (VPA) as saying. Tran Duc Tung, office manager of VPA, said farmers usually sellpepper in bulk at harvest time in the first quarter to cover investmentcosts and other expenses on Lunar New Year holidays. Therefore, sellingprices are often low in the first months of year. Currently,Vietnam is accounting for 30 percent of the global pepper productionand 50 percent of the commercial volume in the global market. Tung said the export pepper price hovered around 6,500 USD per tonne inthe first half of this year, but traders have almost emptied theirpepper stocks at this low price. The total amount of pepperexport in the first six months was equal to that of 2013. However, whenthe pepper price shot up to more than 8,000 USD per tonne in July, therewas little left. Many local businesses suffered losses becausethey had signed contracts at low prices and found it tough to securesufficient pepper for delivery. The losses are all the deeper now as theexport price is approaching 10,000 USD a tonne. “Pepper is acommodity with price volatility. Therefore, businesses should avoidsigning futures contracts. Contracts should only be signed when tradershave secured 70 percent of the volume in stock,” Tung suggested. “VPA gives such recommendations based on production and tradingsituations so that farmers and businesses can avoid losses,” he said. Statistics from VPA showed the export price of pepper was 6,500USD per tonne in the first quarter before going up to 8,335 USD in Julyand over 9,000 USD in September, rising by 1,800-2,500 USD per tonne injust a few months. The local price increased from 149,000 VND akilo in the first quarter to 190,000 VND in September. Pepper price inthe market on October 28 was 182,000-189,000 VND per kilogram. According to the Ministry of Agriculture and Rural Development (MARD),the continuous increase helped raise the average export price inJanuary-September to 7,558 USD per tonne, up 14 percent year-on-year.The export volume in the first 10 months of the year was 145,000 tonnesworth more than 1.1 billion USD, rising 18.5 percent in volume and over35 percent in value compared to the previous year. MARD isorganising an international pepper conference from October 27-30 in HCMCwith the participation of major pepper producing countries such asVietnam, India, Indonesia, Malaysia, Brazil and other spice exportersfrom the U.S., the EU and Japan.-VNA