Sustainable and comprehensive development of Vietnam's pepper and spice industry

Vietnam has been the world leader in pepper production and export for more than 20 years. Vietnam's cinnamon export also ranks first in the world in 2022, and its star anise export ranks third in the world. As of now, Vietnamese pepper and spice have been exported to more than 125 countries, ranking third in global spice exports and dominating many important markets.

Promoting the export of pepper and spice contributes to improving farmer households’ livelihoods, positioning the Vietnamese brand in the world market, and increasing national GDP.

Director of the Plant Protection Department Huynh Tan Dat reaffirmed these above-mentioned things in his opening speech at the Vietnam International Pepper and Spice Outlook 2024 (VIPO 2024) on the morning of March 8. He also noted that Vietnam's pepper exports in 2023 increased by 16.6% in volume but decreased by 6% in value.

Frankly admitting that Vietnam's agriculture has not yet fully developed its potential, the leader of the Plant Protection Department expressed: "Small and fragmented development has limited the ability to access and apply technology, science, and techniques into production. At the same time, investment costs are quite large, causing businesses to consider, while the majority of Vietnamese businesses are small and medium-scale."

It is forecasted that pepper exports in 2024 will be favorable, and the price will increase because the output decreases and inventories are currently at the lowest level in recent years. Therefore, Director Huynh Tan Dat raised the problem of how to attract more businesses to invest in high-tech agriculture in general and pepper in particular.

At the same time, management agencies, businesses, and local governments need to soon find ways to resolve bottlenecks related to land accumulation and concentration, implement large sample fields, etc. Because these are the problems that arise in the process of bringing Vietnam's agriculture sector into the 4.0 industrial revolution in an effective and sustainable way.

In Vietnam's agricultural vision to 2050, the Government has placed agriculture as the focus for sustainable economic development with the readiness to respond to climate change and placed the construction of prosperous, clean, and beautiful rural areas as a strategic priority. Of which, science-technology and investment will be two factors that help realize the goal of sustainable agricultural and rural development.

"The entire agriculture sector must make every effort, engage with domestic and foreign businesses, and combine with industry and services to become spearheads leading the entire economy to sustainable development," the Director of the Plant Protection Department emphasized.

According to Mr. Huynh Tan Dat, organizing the VIPO 2024 Conference helps concretize the above-mentioned task. This is a bridge between Vietnamese and international businesses for sharing market information and updating new regulations in importing countries.

In addition, VIPO 2024 also calls on all agents in the pepper and spice industry, including importers and exporters, traders, farmers, government agencies, financial companies, and non-government organizations, to strengthen cooperation and development and build a healthy and sustainable supply chain.

At the event organized by the Ministry of Agriculture and Rural Development in coordination with the Ministry of Industry and Trade and the Vietnam Pepper and Spice Association (VPSA), Ms. Hoang Thi Lien, President of VPSA, reaffirmed VIPO 2024’s theme of sustainable and comprehensive development of Vietnam’s pepper and spice industry.

"Hopefully, we will be able to hear many sustainable development solutions through today's conference to reduce impacts on nature and meet other environmental and social balance factors," said Ms. Lien.

In the roadmap to promote the green economy that Vietnam pursues, the President of VPSA called on businesses to further raise awareness of their role in ensuring people's livelihoods, because this is the main motivation for sustainable economic development.

VPSA has been trying to integrate sustainable elements into all supply chains while attracting, facilitating, and providing the necessary skills for farmers to both meet market requirements and improve output product quality.

"Sustainable development takes a long time. Therefore, businesses need to listen more to people while focusing on the community factor, helping farmers have more opportunities to cultivate and exchange experiences," the head of VPSA concluded. 

According to statistics from the Ministry of Agriculture and Rural Development, in the first 2 months of 2024, Vietnam's average pepper export price is estimated to reach USD 4,041/ton, up 28.7% over the same period in 2023. At the same time, pepper exports reached 35,000 tons, with a value of USD 143 million, down 12.3% in volume but up 12.9% in value. Vietnam's largest pepper consumption market continues to be the United States, with a proportion of 29%.

Some experts assess that pepper is starting a cycle of increasing prices over many years (usually lasting 10 years). Starting after the Lunar New Year Giap Thin 2024, the domestic pepper price continuously increased.

In addition to internal factors, the reason for the high price of Vietnamese pepper is that Brazil has passed the harvest season, while the main harvest in Indonesia or Malaysia has to be until July.