PELAKITA.ID – Indonesia is a significant player in the global pepper industry, ranking as the third-largest producer of black pepper as of 2020.
In the 2021/2022 period, Indonesia’s pepper production was estimated at approximately 46,000 metric tons.
Province of Lampung is particularly notable, contributing around 50 percent of the country’s black pepper output in 2020.
In 2023, Indonesia exported black pepper valued at approximately 36.1 million U.S. dollars, with primary export destinations including Vietnam, China, and the USA.
However, the industry faces challenges such as reduced cultivation areas, adverse weather conditions, and a shift toward more lucrative crops like coffee and bananas.
These factors have contributed to a decline in production and an increase in black pepper prices in 2024.
Despite these challenges, Indonesia continues to explore new markets for its pepper exports, targeting countries such as Tunisia, the United Arab Emirates, Pakistan, and New Zealand.
Overall, while Indonesia remains a key contributor to the global pepper market, ongoing efforts to address production challenges and expand export markets are crucial for sustaining its position in the industry.
Broken pepper (doc: Pelakita.ID)
International dimensions
The international aspects of the pepper business involve trade dynamics, market demand, regulations, supply chain logistics, and geopolitical influences.
Here are some key international aspects:
Global Production and Key Producers The major pepper-producing countries include Vietnam, India, Indonesia, Brazil, and Sri Lanka. Vietnam is the largest exporter, accounting for over 35% of global pepper supply.
International Trade and Export. Markets Major importers include the U.S., Europe (Germany, Netherlands), China, and the Middle East. Trade routes are heavily dependent on maritime shipping, particularly through ports in Southeast Asia and Latin America.
Price Volatility and Market Factors. Pepper prices fluctuate due to climate conditions, production levels, and global demand. Futures trading in commodities markets (like NCDEX in India) influences pricing.
Small-scla Pepper product in East Luwu (dok: Pelakita.ID)
Regulatory and Quality Standards. Countries enforce strict regulations on pesticide residues, contamination, and quality (e.g., EU food safety regulations). The ISO 959 standard defines pepper quality parameters.
Supply Chain and Logistics. Challenges Issues like container shortages, shipping delays, and high freight costs affect global pepper trade. Large companies rely on bulk exports, warehouses, and third-party logistics providers.
Pepper trees in East Luwu (doc: Pelakita.ID)
Geopolitical and Economic Influences. Trade policies, tariffs, and international sanctions impact exports. Currency fluctuations can affect profit margins and trade agreements.
Sustainability and Ethical Sourcing. There is rising demand for organic, fair-trade, and sustainably sourced pepper. Global initiatives encourage eco-friendly farming and better labor practices.
