Vietnam Pepper Prices Struggle to Rise as Weak Demand Offsets Low Inventories
Vietnamese pepper prices remain under pressure even as producer-country inventories fall to their lowest level in years. Strong exports and rising market shares in the United States and China have yet to overcome cautious purchasing, geopolitical uncertainty and US tariff concerns.
Low stocks provide support but not momentum
Pepper inventories held by producing countries have fallen to their lowest level in several years, but weaker consumption is preventing this supply constraint from producing a sustained price rally. The Vietnam Pepper and Spice Association (VPSA) estimates that producer-country stocks stand at about 170,000 tonnes, including 50,000–60,000 tonnes in Vietnam.
These limited inventories leave relatively little pepper available for export and provide a floor under prices. However, domestic Vietnamese prices have continued to fluctuate around 136,000–139,000 dong per kilogram. Prices increased during July before reversing course in the first 20 days of August, according to VietnamBiz. Global pepper prices also declined in July and recovered only partially in August.
The divergence between tight stocks and hesitant prices reflects pressure on consumption and purchasing decisions. The market is facing geopolitical uncertainty in the Middle East, competition among major producing countries and a cautious approach from importers. US tariff policy has added another reason for buyers to delay commitments or reassess procurement plans.
Exports grow as Vietnam gains market share
Vietnam’s pepper exports nevertheless recorded strong growth in the first seven months of 2026. Customs data cited by VietnamBiz show shipments reached 168,823 tonnes, worth $1.1 billion. Export volume increased by 16.7% from the same period of 2025, while value rose by 11.1%. The slower increase in revenue than in tonnage indicates that higher shipment volumes did not translate into a comparable improvement in average export returns.
The United States remains a crucial destination. According to the US International Trade Commission, the country imported 47,564 tonnes of pepper during the first six months of 2026, up 4.6% year on year. Vietnam supplied 38,221 tonnes, an increase of 24.4%, and accounted for 80.4% of the US market.
Vietnam also overtook Indonesia to become China’s leading pepper supplier in the first half of 2026. Its shipments to China rose 19.9% year on year to 1,980 tonnes. Vietnam’s share of the Chinese market consequently increased from 33.2% to 54.7%, strengthening its position in another major destination.
Imports reshape available supply
Vietnam’s own pepper imports expanded sharply as exporters and processors supplemented domestic availability. VPSA data show imports reached 48,812 tonnes in the first seven months, 55.1% more than a year earlier. The supply mix also changed: purchases from Cambodia surged, while imports from Brazil and Indonesia declined.
This inflow can help Vietnamese companies maintain export volumes despite shrinking local supply, but it also complicates the relationship between domestic inventories and prices. In the near term, VPSA expects imports by US companies may slow while buyers assess tariff effects and adjust purchasing plans. The association expects the impact to remain limited if competing supplier countries face similar tariff rates, because the United States remains heavily dependent on imported pepper and Vietnam is still its largest supplier.
The market therefore has two opposing forces. Low inventories and restricted export supply support prices, while subdued demand and cautious procurement limit further gains. For producers, processors and traders, the timing of US purchases and the durability of demand in China will be central to whether tight physical availability eventually translates into higher prices.
