VIETNAM PEPPER INDUSTRY REPORT Q2/2018

Transcription

1 VIETNAM PEPPER INDUSTRY REPORT Q2/2018 1

2 Content Part Page Part Page Abbreviations Value chain of the industry 27 Executive summary Current situation of production Business environment Consumption Macroeconomic situation Pepper Import Export Legal framework Price movement of some types of pepper World pepper market Industry overview Current situation of production SWOT Analysis Definition and classification Planning Pepper industry Production Enterprise analysis Consumption Enterprise introduction Vietnam pepper market Enterprise analysis History of industry formation and development 24 2

3 Abbreviations MAMPU Malaysian Administrative Modernisation and Management Planning Unit SB State Bank WASI Western Highlands Agriculture and Forestry Science Institute SB State Budget IASVN Institute of Agricultural Science for Southern Vietnam GDVC General Department of Vietnam Customs IPC International Pepper Community GSO General Statistics Office of Vietnam ASTA American Spice Trade Association JSB Joint Stock Bank IPSARD Institute of Policy and Strategy for Agriculture and Rural Development CO., LTD Company Limited VIRI Vietnam Rural Industries Research and Development Institute SBV The State Bank of Vietnam Nedspice Nedspice Processing Vietnam Company Limited CB Commercial Bank VIRAC Vietnam Industry Research and Consultancy Joint Stock Company MARD Ministry of Agriculture and Rural Development 3

4 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. 4

5 Executive summary 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 , after a sharp fall in two consecutive years from late 2015 to 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. 5

6 Content 1. Business environment 1.1 Macroeconomic situation 1.2 Legal framework 6

7 1. Business environment 1.1 Macroeconomic situation GDP growth, M/2018 the gross domestic product (GDP) in Q1/2018 was estimated to increase by 7.38% in comparison with the same period in Source: VIRAC, GSO Gross output of agriculture, forestry and fishery at comparative prices (2010), Source: VIRAC, GSO 7

8 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, /2018 Average lending rate, 2012 Q1/2018 Source: VIRAC, GSO Source: VIRAC, GSO 8

9 1. Business environment 1.1 Macroeconomic situation billion USD Import - Export, 2015 Q1/2018 billion USD Source: VIRAC, GDVC Value share of pepper industry contributing to Vietnam s export turnover, M/2018 billion USD % Source: VIRAC, GDVC 9

10 Content 1. Business environment 1.1 Macroeconomic situation 1.2 Legal framework 10

11 1. Business environment 1.2 Legal framework Group of regulations on production and business of pepper industry 11

12 1. Business environment 1.2 Legal framework 12

13 1. Business environment 1.2 Legal framework Group of regulations on import and export of pepper industry 13

14 1. Business environment 1.2 Legal framework Group of regulations on tariffs of pepper industry 14

15 Content 2. World pepper market 2.1 Current situation of production 2.2 Consumption 15

16 2. World pepper market 2.1 Current situation of production Definition and classification Definition Uses Classification 16

17 2. World pepper market 2.1 Current situation of production Definition and classification 17

18 2. World pepper market 2.1 Current situation of production Definition and classification Differences betweem black pepper and white pepper Indicator Black pepper White pepper 18

19 2. World pepper market 2.1 Current situation of production Production Thousand tons Global pepper production by type, e Source: VIRAC, IPC Growth in world's new pepper growing area over the years, e % Strong growth in area and productivity will increase world pepper supply in the upcoming years. Source: VIRAC, Nedspice 19

20 2. World pepper market 2.1 Current situation of production Production Structure of global black pepper production by country, 2017e Structure of global white pepper volume by country, 2017e Source: VIRAC, Nedsprice Source: VIRAC, Nedsprice 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. 20

21 Content 2. World pepper market 2.1 Current situation of production 2.2 Consumption 21

22 2. World pepper market 2.2 Consumption Thousand tons Pepper consumption worldwide, e Hot-growth phenomenon of pepper can lead to imbalance in supply and demand in the future when supply growth exceeds demand growth. Pepper consumption structure by region, 2017e Source: VIRAC, Nedspice Source: VIRAC, Nedspice 22

23 2. World pepper market 2.2 Consumption Pepper consumption in world s largest pepper producing countries, e Thousand tons Source: VIRAC, Nedspice 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. 23

24 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 24

25 3. Vietnam pepper market 3.1 History of industry formation and development In Vietnam, wild pepper was found before the 16th century, but it was not until the 17th century that pepper trees were widely grown

26 3. Vietnam pepper market 3.1 History of industry formation and development nay 26

27 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 27

28 3. Vietnam pepper market 3.2 Value chain of the industry R&D Value added chain model for agricultural products Crop Source: VIRAC Processing Distribution Marketing 28

29 3. Vietnam pepper market 3.2 Value chain of the industry Value chain of pepper industry Value chain mapping of pepper industry Source: VIRAC 29

30 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 30

31 3. Vietnam pepper market 3.3 Current situation of production Industry scale Pepper cultivation area in Vietnam, Thousand hectares % Structure of pepper cultivation in Vietnam, 2017 Source: VIRAC, MARD Source: VIRAC, VPA 31

32 3. Vietnam pepper market 3.3 Current situation of production Central Highlands Main pepper growing regions in Vietnam The Southeast 32

33 3. Vietnam pepper market 3.3 Current situation of production Pepper production in Vietnam, M/2018e Thousand tons % Source: VIRAC, MARD Pepper supply in Vietnam is likely to be surplus in 2018 mainly due to the Pepper structure by type, 2016 following reasons : Source: VIRAC, IPC 33

34 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 34

35 3. Vietnam pepper market 3.4 Consumption Pepper consumption in Vietnam, e Thousand tons 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 Source: VIRAC, Nedspice Source: VIRAC, Nedspice 35

36 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 36

37 3. Vietnam pepper market 3.5 Pepper Import - Export By the end of March 2018, Vietnam had exported thousand of pepper Thousand tons Pepper exports and export turnover in Vietnam, M/2018 million USD Source: VIRAC, GDVC 37

38 3. Vietnam pepper market 3.5 Pepper Import - Export Structure of Vietnam s pepper importers by volume, 3M/2018 Pepper export volume by country, 3M/2018 Source: VIRAC, GDVC Source: VIRAC, GDVC 38

39 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 Source: VIRAC, GDVC removed for demo purpose Source: VIRAC, Trademap In the first two months of 2018, the value of exported black pepper reached over 97 million USD 39

40 3. Vietnam pepper market 3.5 Pepper Import - Export Pepper export price has continued decreasing for the recent two years; therefore, pepper export value of most enterprises fell despite an increase in volume. Top 10 largest pepper export enterprises in Vietnam, 3M/2018 Structure of Vietnam s pepper export by type of enterprise, M/2018 Source: VIRAC, GDVC The proportion of FDI enterprises contribution to Vietnam s export is gradually decreasing Source: VIRAC, GDVC 40

41 3. Vietnam pepper market 3.5 Pepper Import - Export It is estimated that Vietnam imported thousand tons of pepper in 2017 thousand tons Vietnam s pepper import, e Nội dung được xóa nhằm mục đích demo Source: VIRAC, GDVC Structure of Vietnam s pepper import by type, 2016 Top pepper importing countries by value,(usd), Source: VIRAC, Uncomtrade Source: VIRAC, Uncomtrade 41

42 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 42

43 3. Vietnam pepper market 3.6 Price movement of some types of pepper Time and schedule of pepper harvest of Vietnam s pepper regions Region January February March April May 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. Source: VIRAC, IPSARD The weather in 2017 is signaling unfavorable conditions for new pepper trees. 43

44 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 USD/ton Source: VIRAC Export price movement of pepper in Vietnam, 4/2017-4/2018 Source: VIRAC 44

45 3. Vietnam pepper market 3.6 Price movement of some types of pepper The wholesale price of black pepper by month, 1/2017-3/2018 The wholesale price of black pepper by week, 1/2018-3/2018 VND/kg Source: VIRAC, MARD Source: VIRAC, MARD 45

46 Content 4. Industry overview 4.1 SWOT analysis 4.2 Development planning of pepper industry 46

47 4. Industry overview 4.1. SWOT analysis Strengths: Weaknesses: Opportunities: Threats: 47

48 Content 4. Industry overview 4.1 SWOT analysis 4.2 Development planning of pepper industry 48

49 4. Industry overview 4.2 Development planning of pepper industry Promoting production linkages, ensuring food hygiene and safety, aiming at sustainable development 49

50 4. Industry overview 4.2 Development planning of pepper industry Increasing trade and integration 50

51 Content 5. Enterprise analysis 5.1 Enterprise introduction 5.2 Enterprise analysis 51

52 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) 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. 52

53 5. Enterprise analysis 5.1 Enterprise introduction Intimex Group 53

54 5. Enterprise analysis 5.1 Enterprise introduction Olam Vietnam Co., Ltd. 54

55 5. Enterprise analysis 5.1 Enterprise introduction Phuc Sinh Joint Stock Company 55

56 5. Enterprise analysis 5.1 Enterprise introduction Petrolimex International Trading Joint Stock Company 56

57 5. Enterprise analysis 5.1 Enterprise introduction Hanoi Production Services Import Export Joint Stock Company 57

58 5. Enterprise analysis 5.1 Enterprise introduction Nedspice Processing Vietnam Company Limited 58

59 5. Enterprise analysis 5.1 Enterprise introduction Pearl Trading Service and Import Export Joint Stock Company Pearl Corp 59

60 5. Enterprise analysis 5.1 Enterprise introduction Harris Freeman Vietnam Company Limited 60

61 5. Enterprise analysis 5.1 Enterprise introduction Lien Thanh Joint Stock Company 61

62 5. Enterprise analysis 5.1 Enterprise introduction DK Commodity Co., Ltd. 62

63 Contents 5. Enterprise analysis 5.1 Enterprise introduction 5.2 Enterprise analysis 63

64 5. Enterprise analysis 5.2 Enterprise analysis billion VND Net revenue from goods sold and services provided, % Source: VIRAC 64

65 5. Enterprise analysis 5.2 Enterprise analysis Gross profit and gross profit margin of enterprises, 2016 billion VND % Source: VIRAC 65

66 5. Enterprise analysis 5.2 Enterprise analysis % Sales expenses/net revenue, Source: VIRAC 66

67 5. Enterprise analysis 5.2 Enterprise analysis % Administrative expenses/net revenue, Source: VIRAC % Financial expenses/net revenue, Source: VIRAC 67

68 5. Enterprise analysis 5.2 Enterprise analysis billion VND Asset structure, 2016 Content is intentionally removed Cơ for cấu Source demo vốn, 2016 purpose Source: VIRAC billion VND Source: VIRAC 68

69 5. Enterprise analysis 5.2 Enterprise analysis Solvency, 2016 Asset use efficiency, 2016 Source: VIRAC Source: VIRAC 69

70 5. Enterprise analysis 5.2 Enterprise analysis Lien Thanh Phuc Sinh Haprosimex JSC Pearl Corporation Pitco Harris Freeman DK Nedspice Olam Intimex ROA ROE ROS Profit after tax Debt to total assets ratio Debt to equity ratio 70

71 Report Disclaimer 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. SHOULD YOU NEED ANY ASSISTANCE, PLEASE CONTACT US: VIETNAM INDUSTRY RESEARCH AND CONSULTANCY (VIRAC JSC.,) 6 th Floor, Anh Minh Building, 36 Hoang Cau, O Cho Dua, Dong Da, Hanoi, Vietnam Website: viracresearch@virac.com.vn Tel:

72 Thank you! 72