How will the market for dried Chinese pepper react to the disastrous market developments of fresh peppers?

The market price of small peppers in northern China recently stopped falling and stabilized as the trade volume of peppers from refrigerated storage began to grow. The price then started to rise and the market improved. As for imported peppers, the price of Indian peppers is steadily rising. Chinese market demand for Indian peppers is growing because the schools recently opened again, which means that school canteens are buying agricultural products in large volumes. The trade volume of Indian peppers is much larger than in August, but supply and demand are quite balanced. The reason that the price of Indian peppers is rising is because the domestic price of Indian peppers is rising. However, although the Indian pepper market experiences many fluctuations, the Chinese import market for Indian peppers remains stable.

In addition, the price of peppers from refrigerated storage went up last week (August 30 - September 5). There are several reasons for this development:

(1) Production areas in Jinxiang suffer from flooding. The supply of dried peppers remains stable. The initial arrival of large volumes of dried pepper has subsided. At the same time, the product quality of these dried peppers is improving. Buyers show strong interest and the purchase volume is growing.

(2) Although the supply of peppers from refrigerated storage is smooth, the overall supply volume is not that large. Traders with stock in storage are unwilling to sell their peppers at a low price. So even though the price of top-quality peppers is slightly falling, that development is also limited.

(3) Buyers who purchase hot peppers for wholesale trade and processing are still looking to trade, but they are careful with the large volumes of dried peppers that recently entered the market. Their demand volume is somewhat lessened. The stability in the dried pepper market stimulates demand for peppers from refrigerated storage, where the price is now rising as well.

Jinxiang recently suffered from flooding and many people in the pepper industry are predicting a price increase could follow. Although the price rise is slowing down at 7 yuan [1.02 USD] per 0.5 kg, a second rise is expected.

Source: e658.com


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