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1 VIETNAM PEPPER INDUSTRY REPORT Q2/2018
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VIETNAM PEPPER INDUSTRY REPORT Q2/2018
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Content
Part Page Part Page
Abbreviations 3 3.2. Value chain of the industry 27
Executive summary 4 3.3. Current situation of production 30
1. Business environment 6 3.4. Consumption 34
1.1. Macroeconomic situation 6 3.5. Pepper Import – Export 36
1.2. Legal framework 10 3.6. Price movement of some types of pepper 42
2. World pepper market 15 4. Industry overview 46
2.1. Current situation of production 15 4.1. SWOT Analysis 46
2.1.1. Definition and classification 16 4.2. Planning Pepper industry 48
2.1.2. Production 19 5. Enterprise analysis 51
2.2. Consumption 22 5.1. Enterprise introduction 51
3. Vietnam pepper market 24 5.2. Enterprise analysis 63
3.1. History of industry formation and development 24
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Abbreviations
MAMPUMalaysian Administrative Modernisation and
Management Planning UnitSB State Bank
WASIWestern Highlands Agriculture and Forestry Science
InstituteSB State Budget
IASVNInstitute of Agricultural Science for Southern
VietnamGDVC General Department of Vietnam Customs
IPC International Pepper Community GSO General Statistics Office of Vietnam
ASTA American Spice Trade Association JSB Joint Stock Bank
IPSARDInstitute of Policy and Strategy for Agriculture and
Rural DevelopmentCO., LTD Company Limited
VIRIVietnam Rural Industries Research and
Development InstituteSBV The State Bank of Vietnam
Nedspice Nedspice Processing Vietnam Company Limited CB Commercial Bank
VIRACVietnam Industry Research and Consultancy
Joint Stock Company MARD Ministry of Agriculture and Rural Development
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Executive summary
• Pepper industry is one of the agricultural sectors that make an important contribution to the entire agriculture in Vietnam.
• Common pepper products in the world market are black pepper and white pepper.
• Today, pepper, a high-end spice, is the most commonly used spice in the world and plays the leading role (about 34%) in total spice production
value traded in the world.
• Global demand for pepper has been increasing, which makes pepper trade also dynamic.
• The global pepper price depend on the variations of pepper prices in major pepper exprorters.
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• Vietnamese pepper is now exported to nearly 80 countries and territories all over the world.
• The average pepper export price of Vietnam was booming in the period 2012-2015, after a sharp fall in two consecutive years from late 2015 to
2017.
• The export turnover of many enterprises declined because the average export price of pepper in 2016 had continuously decreased since the end of
2015, affecting the business results.
Executive summary
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1. Business environment
1.1 Macroeconomic situation
1.2 Legal framework
Content
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1. Business environment
1.1 Macroeconomic situation
Source: VIRAC, GSO
Source: VIRAC, GSO
GDP growth, 2012 – 3M/2018
Gross output of agriculture, forestry and fishery at comparative
prices (2010), 2015 - 2018
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the gross domestic product (GDP) in Q1/2018 was estimated to increase
by 7.38% in comparison with the same period in 2017.
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1. Business environment
1.1 Macroeconomic situation
The VND / USD exchange rate has been quite stable and still supported by a
plentiful supply of foreign currencies
VND/USD exchange rate, 2013-3/2018
Source: VIRAC, GSO
Source: VIRAC, GSO
Average lending rate, 2012 – Q1/2018
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1. Business environment
1.1 Macroeconomic situation
Value share of pepper industry contributing to Vietnam’s export turnover,
2010 – 3M/2018
Source: VIRAC, GDVC
billion USD
%
Source: VIRAC, GDVC
Import - Export, 2015 – Q1/2018
billion USD billion USD
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1. Business environment
1.1 Macroeconomic situation
1.2 Legal framework
Content
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1. Business environment
1.2 Legal framework
Group of regulations on production and business of pepper industry
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1. Business environment
1.2 Legal framework
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1. Business environment
1.2 Legal framework
Group of regulations on import and export of pepper industry
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1. Business environment
1.2 Legal framework
Group of regulations on tariffs of pepper industry
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2. World pepper market
2.1 Current situation of production
2.2 Consumption
Content
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2. World pepper market
2.1 Current situation of production - 2.1.1. Definition and classification
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Definition
Uses
Classification
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2. World pepper market
2.1 Current situation of production - 2.1.1. Definition and classification
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Indicator Black pepper White pepper
Differences betweem black pepper and white pepper
2. World pepper market
2.1 Current situation of production - 2.1.1. Definition and classification
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2. World pepper market
2.1 Current situation of production - 2.1.2. Production
Global pepper production by type, 2012-2017eThousand tons
Source: VIRAC, IPC
• Strong growth in area and productivity will increase world pepper
supply in the upcoming years.
Growth in world's new pepper growing area over the years, 2014 - 2017e
Source: VIRAC, Nedspice
%
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Structure of global black pepper production by country, 2017e Structure of global white pepper volume by country, 2017e
2. World pepper market
2.1 Current situation of production - 2.1.2. Production
• In the past, India, Malaysia, Indonesia, Brazil were the leading pepper producers in the world, surpassing other countries. However, since 2005, Vietnam has
risen to become the world's largest pepper producer and has maintained its status for 12 years.
Source: VIRAC, Nedsprice Source: VIRAC, Nedsprice
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2. World pepper market
2.1 Current situation of production
2.2 Consumption
Content
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2. World pepper market
2.2 Consumption
Pepper consumption worldwide, 2012 – 2017e
Source: VIRAC, Nedspice
Thousand tons
Pepper consumption structure by region, 2017e
Source: VIRAC, Nedspice
Hot-growth phenomenon of pepper can lead to imbalance in supply
and demand in the future when supply growth exceeds demand growth.
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2. World pepper market
2.2 Consumption
Pepper consumption in world’s largest pepper producing countries, 2016 – 2017e
Source: VIRAC, Nedspice
Thousand tons
• Pepper consumption in major pepper producing countries such as Vietnam, Indonesia and Brazil has been increasing, but the growth rate and
pepper consumption in these countries is much lower than that of other pepper importing countries such as The United States, Germany,
Netherlands., etc.
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3. Vietnam pepper market
3.1 History of industry formation and development
3.2 Value chain of the industry
3.3 Current situation of production
3.4 Consumption
3.5 Pepper Import - Export
3.6 Price movement of some types of pepper
Content
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In Vietnam, wild pepper was found before the 16th century, but it was not until the 17th century that pepper trees were widely grown.
1910-1970 1983-1995
3. Vietnam pepper market
3.1 History of industry formation and development
1996-1999
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2000-2005 2007-2015 2016-nay
3. Vietnam pepper market
3.1 History of industry formation and development
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Content
3. Vietnam pepper market
3.1 History of industry formation and development
3.2 Value chain of the industry
3.3 Current situation of production
3.4 Consumption
3.5 Pepper Import - Export
3.6 Price movement of some types of pepper
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Processing
Distribution
Marketing
R&D
Crop
3. Vietnam pepper market
3.2 Value chain of the industry
Source: VIRAC
Value added chain model for agricultural products
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Value chain of pepper industry
3. Vietnam pepper market
3.2 Value chain of the industry
Source: VIRAC
Value chain mapping of pepper industry
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Content
3. Vietnam pepper market
3.1 History of industry formation and development
3.2 Value chain of the industry
3.3 Current situation of production
3.4 Consumption
3.5 Pepper Import - Export
3.6 Price movement of some types of pepper
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Industry scale%
Pepper cultivation area in Vietnam, 2009 - 2017
Source: VIRAC, MARD
Thousand hectares
3. Vietnam pepper market
3.3 Current situation of production
Source: VIRAC, VPA
Structure of pepper cultivation in Vietnam, 2017Content is intentionally removed for demo purpose
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Main pepper growing regions in Vietnam
3. Vietnam pepper market
3.3 Current situation of production
• Central Highlands
• The Southeast
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Pepper supply in Vietnam is likely to be surplus in 2018 mainly due to the
following reasons :
3. Vietnam pepper market
3.3 Current situation of production
Pepper production in Vietnam, 2011-3M/2018e
Thousand tons
Source: VIRAC, MARD
Pepper structure by type, 2016
%
Source: VIRAC, IPC
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Content
3. Vietnam pepper market
3.1 History of industry formation and development
3.2 Value chain of the industry
3.3 Current situation of production
3.4 Consumption
3.5 Pepper Import - Export
3.6 Price movement of some types of pepper
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3. Vietnam pepper market
3.4 Consumption
Thousand tons
Pepper consumption in Vietnam, 2011-2017e
Source: VIRAC, Nedspice
Source: VIRAC, Nedspice
• Pepper consumption in Vietnam has increased over the years
because the spice using habits of Vietnamese people are gradually
changing
Distribution structure of pepper volume in Vietnam, 2016
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Content
3. Vietnam pepper market
3.1 History of industry formation and development
3.2 Value chain of the industry
3.3 Current situation of production
3.4 Consumption
3.5 Pepper Import - Export
3.6 Price movement of some types of pepper
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3. Vietnam pepper market
3.5 Pepper Import - Export
Pepper exports and export turnover in Vietnam, 2011 –
3M/2018
Source: VIRAC, GDVC
Thousand tonsmillion USD
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By the end of March 2018, Vietnam had exported 60.03 thousand
of pepper
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3. Vietnam pepper market
3.5 Pepper Import - Export
Source: VIRAC, GDVC
Structure of Vietnam’s pepper importers by volume, 3M/2018
Content is intentionally removed for demo purposePepper export volume by country, 3M/2018
Source: VIRAC, GDVC
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In the first two months of 2018, the value of exported black pepper reached over 97 million USD
3. Vietnam pepper market
3.5 Pepper Import - Export
Structure of exported pepper by type, 2M/2018 Structure of exported pepper by processing step, 2016
Content is intentionally removed for demo purposeSource: VIRAC, TrademapSource: VIRAC, GDVC
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3. Vietnam pepper market
3.5 Pepper Import - Export
Top 10 largest pepper export enterprises in Vietnam, 3M/2018
Source: VIRAC, GDVC
Structure of Vietnam’s pepper export by type of enterprise,
2013 – 3M/2018
Source: VIRAC, GDVC
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Pepper export price has continued decreasing for the recent two years;
therefore, pepper export value of most enterprises fell despite an increase
in volume.
The proportion of FDI enterprises’ contribution to Vietnam’s export is
gradually decreasing
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thousand tons
Vietnam’s pepper import, 2010 – 2017e
Source: VIRAC, GDVC
Source: VIRAC, Uncomtrade
Structure of Vietnam’s pepper import by type, 2016
Source: VIRAC, Uncomtrade
Nội dung được xóa nhằm mục đích demo
It is estimated that Vietnam imported 30.27 thousand tons of pepper in 2017
Top pepper importing countries by value,(USD), 2016 - 2017
3. Vietnam pepper market
3.5 Pepper Import - Export
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Content
3. Vietnam pepper market
3.1 History of industry formation and development
3.2 Value chain of the industry
3.3 Current situation of production
3.4 Consumption
3.5 Pepper Import - Export
3.6 Price movement of some types of pepper
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3. Vietnam pepper market
3.6 Price movement of some types of pepper
Region January February March April May
Time and schedule of pepper harvest of Vietnam’s pepper regions
Source: VIRAC, IPSARD
Note: x little harvest; xx consolidated harvest; xxx very consolidated harvest.
• In Vietnam, pepper harvest time is also relatively different among the main cultivated areas.
• The weather in 2017 is signaling unfavorable conditions for new pepper trees.
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3. Vietnam pepper market
3.6 Price movement of some types of pepper
Average monthly export price of pepper, 1/2017- 3/2018
USD/ton
Source: VIRAC
Source: VIRAC
USD/ton
Export price movement of pepper in Vietnam,
4/2017-4/2018
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3. Vietnam pepper market
3.6 Price movement of some types of pepper
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VND/kg
The wholesale price of black pepper by month, 1/2017 - 3/2018
Source: VIRAC, MARDSource: VIRAC, MARD
The wholesale price of black pepper by week, 1/2018 - 3/2018
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4. Industry overview
4.1 SWOT analysis
4.2 Development planning of pepper industry
Content
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Strengths: Weaknesses:
Opportunities: Threats:
4. Industry overview
4.1. SWOT analysis
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Content
4. Industry overview
4.1 SWOT analysis
4.2 Development planning of pepper industry
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Promoting production linkages, ensuring food hygiene and safety, aiming at sustainable development
4. Industry overview
4.2 Development planning of pepper industry
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Increasing trade and integration
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4. Industry overview
4.2 Development planning of pepper industry
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5. Enterprise analysis
5.1 Enterprise introduction
5.2 Enterprise analysis
Content
5. Enterprise analysis
5.1 Enterprise introduction
TOP PEPPER EXPORTING ENTERPRISES IN 2016
Enterprise Name Address Tax code
Net Revenue
(billion VND) Total assets
(billion VND)2015 2016
Intimex Group
Olam Vietnam Co., Ltd.
Phuc Sinh Joint Stock Company
Petrolimex International Trading
Joint Stock Company
Hanoi Investment Trading and
Import & Export Company Limited
Nedspice Processing Vietnam
Company Limited
Pearl Trading Service and Import
Export Joint Stock Company
Harris Freeman Vietnam Company
Limited
Lien Thanh Joint Stock Company
DK Commodity Co., Ltd.
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5. Enterprise analysis
5.1 Enterprise introduction
Intimex Group
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5. Enterprise analysis
5.1 Enterprise introduction
Olam Vietnam Co., Ltd.
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5. Enterprise analysis
5.1 Enterprise introduction
Phuc Sinh Joint Stock Company
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5. Enterprise analysis
5.1 Enterprise introduction
Petrolimex International Trading Joint Stock Company
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5. Enterprise analysis
5.1 Enterprise introduction
Hanoi Production Services Import Export Joint Stock Company
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Nedspice Processing Vietnam Company Limited
5. Enterprise analysis
5.1 Enterprise introduction
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5. Enterprise analysis
5.1 Enterprise introduction
Pearl Trading Service and Import Export Joint Stock Company
Pearl Corp
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Harris Freeman Vietnam Company Limited
5. Enterprise analysis
5.1 Enterprise introduction
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Lien Thanh Joint Stock Company
5. Enterprise analysis
5.1 Enterprise introduction
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5. Enterprise analysis
5.1 Enterprise introduction
DK Commodity Co., Ltd.
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5. Enterprise analysis
5.1 Enterprise introduction
5.2 Enterprise analysis
Contents
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Net revenue from goods sold and services provided, 2015-2016
Source: VIRAC
billion VND
5. Enterprise analysis
5.2 Enterprise analysis
%
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Gross profit and gross profit margin of enterprises, 2016
billion VND %
Source: VIRAC
5. Enterprise analysis
5.2 Enterprise analysis
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Sales expenses/Net revenue, 2015-2016
Source: VIRAC
5. Enterprise analysis
5.2 Enterprise analysis
%
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Source: VIRAC
Administrative expenses/Net revenue, 2015-2016
Source: VIRAC
Financial expenses/Net revenue, 2015-2016
5. Enterprise analysis
5.2 Enterprise analysis
%
%
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Asset structure, 2016billion VND
Source: VIRAC
Cơ cấu Source vốn, 2016
billion VND
Source: VIRAC
5. Enterprise analysis
5.2 Enterprise analysis
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Solvency, 2016
Source: VIRAC
Source: VIRAC
Asset use efficiency, 2016
5. Enterprise analysis
5.2 Enterprise analysis
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Lien Thanh Phuc SinhHaprosimex
JSC
Pearl
CorporationPitco
Harris
Freeman DK Nedspice Olam Intimex
ROA
ROE
ROS
Profit after tax
Debt to total assets ratio
Debt to equity ratio
5. Enterprise analysis
5.2 Enterprise analysis
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Report Disclaimer
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Report disclaimer
This document has been prepared in good faith on the basis of information available at the date of publication without any independent verification. VIRAC has
produced this report for private circulation to professional clients only. All information and statistical data herein have been obtained from sources we believe to
be reliable and made to ensure the accuracy of the contents of the pages of the report at the time of preparation. Such information has not been independently
verified and VIRAC makes no representation or warranty, whether express or implied, of any kind with respect to the document and its contents, information and
materials. The content found in this report is proprietary to VIRAC and is provided solely for your personal and non-commercial use. You agree that you will not
use this report for any purpose that is unlawful and that you will not reproduce the report or redistribute it outside your organization, or place it on a website for
public access without the express written permission of VIRAC.
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VIETNAM INDUSTRY RESEARCH AND CONSULTANCY (VIRAC JSC.,)
6th Floor, Anh Minh Building, 36 Hoang Cau, O Cho Dua, Dong Da, Hanoi, Vietnam
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Email: [email protected] | Tel: +84 463289520
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