Black pepper prices have increased by ₹16 per kilogram over the last three weeks, driven by strong Deepavali demand. While sellers are currently holding stocks, investors should track global harvest arrivals from Brazil and Indonesia, as lower international prices could limit further gains.
Domestic black pepper prices have climbed ₹16 per kilogram over the past three weeks. This trend is largely linked to the upcoming Deepavali festival, which typically triggers a seasonal rise in demand from traders and processors rushing to honor forward contracts. In the Kochi market, farm-grade ungarbled pepper is currently trading at ₹720 per kilogram, while garbled pepper is priced at ₹740 per kilogram.
The current price increase is supported by a supply strategy where primary sellers are withholding stocks, betting on further price appreciation. Despite recent arrivals of 36 tonnes in the terminal market, supply remains restricted. Dealers are actively procuring stock to meet time-bound delivery commitments, adding pressure to local prices.
However, the situation carries risks related to international price gaps. Indian pepper is currently trading at an equivalent of roughly $7,825 per tonne. This level is significantly higher than global benchmarks, which makes the Indian market attractive for imports. Currently, pepper from Sri Lanka is being imported to fill the domestic supply gap.
Looking ahead, the international supply landscape may influence local price trends. Major producers like Brazil and Indonesia are entering their harvest seasons. Global prices are currently more competitive, with Brazil offering pepper below $6,000 per tonne, Vietnam at $6,000, and Indonesia at $6,500. Investors and traders may monitor whether the arrival of these global harvests and increased import volumes act as a cooling factor for domestic prices once the immediate festive demand begins to fade.