Vietnam could ship more than US$1 billion worth of pepper abroad for the whole 2024 on the back of high global demand and limited supply, according to the Vietnam Pepper and Spice Association (VPSA).

The pepper industry, the association said, is on track to return to the "billion-dollar" club, with export revenues hitting US$764.2 million as of July 30.

During the seven-month span, more than 164,300 tonnes of pepper was sold to foreign markets at an average export price of $4,568 per tonne for black pepper and $6,195 per tonne for white pepper, up 32.7% and 25%, respectively, year on year.

The U.S. was the largest purchaser, followed by Germany, the United Arab Emirates (UAE), and India.

Brazil, the world's second-biggest black pepper producer and exporter, has suffered crop failure, driving global prices skyward for the remaining months of 2024. Production in Vietnam, Malaysia and Indonesia is also forecast to fall sharply due to the impacts of El Nino.

In the next three to five years, pepper supply will lag behind demand.

Domestic pepper prices in July fetched VND150,000 (over $6) per kilogram, rising 82.9% against January, and 120.6% year-on-year.

The VPSA forecasts a fluctuation in pepper prices in the coming time due to formidable challenges in the market.

According to a survey conducted by the VPSA in three Central Highlands localities in July, along with extreme weather caused by climate change, farmers chose durian and coffee production over pepper as the first two fetch higher prices.

Vietnam’s key pepper planting areas of Gia Lai, Dak Lak and Dak Nong in the Central Highlands, and Binh Phuoc, Dong Nai and Ba Ria–Vung Tau in the southeastern region slashed cultivation acreage by 50% as compared to peak cultivation times. - VNA