Pepper loses zing in an import glut

Steep fall: Pepper prices crashed from ₹760 a kg in 2016 to ₹400 last year   | Photo Credit: M_ SATHYAMOORTHY

The floods of 2018 destroyed pepper crop in the State. The drought that followed was not kind either. Diseases affecting the vines and a sharp decline in crop price added to the misery.

“Pepper production declined after the deluge. The drought triggered fungal diseases such as quick wilt and soft wilt,” says Kishore Shamji Kuruwa, Cochin chapter head, Indian Pepper and Spice Traders, Farmers, Producers and Planters Consortium.

The average production of black pepper in the State two years ago was around 18,000 to 22,000 tonnes, including 12,000 to 13,000 tonnes in Idukki and 5,000 to 7,000 tonnes in Wayanad. But the production fell to 75% to 80% in Wayanad and 25% to 30% in Idukki districts this season, he says.

Disease threat

Hundreds of acres of pepper plantations in the State are under the threat of quick wilt disease owing to the still prevailing drought-like situation.

“I had replanted pepper vines on three acres four years ago, of which vines on an acre have been destroyed by the quick wilt disease,” says George, a farmer from Nadavayal in Wayanad. He had spent more than ₹4.5 lakh to raise pepper, raising the money by disposing of an acre of land. The disease spread widely in the drought-like situation after the deluge, he says.

Reji Thomas, a marginal farmer from Vazhavatta, says he got three quintals of black pepper from his two acres but most of the vines were destroyed by quick wilt. Pepper prices crashed from ₹760 a kg in 2016 to ₹400 last year. On Friday, the farm gate price of pepper in Wayanad was ₹300-₹310. “It was ₹500 in the corresponding period last year,” reminds M.C. Abdu, a pepper dealer in Wayanad.

According to the Spices Board, the total production of pepper in the country during the last fiscal was about 55,000 tonnes, including 20,000 tonnes from Kerala, 10,000 tonnes from Tamil Nadu, and the remaining from Karnataka. Domestic consumption comes to about 55,000 tonnes a year.

The ‘foreign’ impact

More than 32,000 tonnes of pepper were imported in 2018, Kishore says. “Of this 20,000 tonnes came from Sri Lanka, and the rest from Vietnam, Indonesia and Brazil which was mainly used for re-export.”

The Ministry of Commerce had fixed a minimum import price (MIP) of ₹500 a kg in December 2017 to curb imports. When import continued with the aid of loopholes in the order, the ministry amended the restrictions a few months ago. But that too failed to yield positive results, Kishore says. More than 6,000 tonnes of pepper were imported last year for domestic and re-export purposes even after the amendment.

“The influx of imported pepper from Vietnam via Sri Lanka is the major reason for the fall in prices in the Indian market,” Abdu says. Cheaper pepper from Vietnam continues to flood the market through Sri Lanka, aided by a low-duty structure under South Asian Free Trade Area (SAFTA) pact and Indo-Sri Lanka Free Trade Agreement (ISFTA).

Flooding of ‘smuggled’ pepper in Indian markets from Vietnam via Bangladesh, Myanmar, and Nepal, through the Kolkata port, poses a huge threat to the industry, he says. Such trade also avoids payment of GST. Close to 20,000 tonnes of pepper have reached the country illegally in the last five months.

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Printable version | Jan 19, 2022 7:45:25 AM |

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