Prominent exporter and former president of Indian Pepper and Spices Trade Association (Ipsta) T Vidyasagar told The Financial Express that the forecast for Indian pepper in the short to medium-term is bearish.

"The market is set to enter a bearish phase ending sustained rally during the past couple of years," he said.

Following the reports of spurt in production in major pepper producing countries, speculators operating in major trading centres are hammering the Indian pepper down. "Speculators in Rotterdam, Hong Kong and Singapore are targeting Indian pepper and are trying to hammer the prices down," Vidysagar said.

The wide disparity between the Indian and internationalprices is putting pressure on the export prospects of Indian pepper. While Indian pepper is still ruling at a high of $ 4,500 per tonne for the April shipment, the Vietnamese price tag is $ 900 low at $ 3,600 per tonne for the April shipment.

Though Indian pepper is superior in quality compared to the Vietnamese crop, the glaring price disparity has prompted the international buyers to wait and see the Indian prices softening. Even the matured market like the US was not ready to opt for Indian pepper at this price, he said. US buyers who generally opt for quality pepper even at higher price were offering up to $ 4,000 per tonne. The US market accounts for over 60 per cent of the total pepper export from India.

He said the shortage in the global supply chain, which pushed up the Indian pepper prices up past two years, has ceased to exist with the supply chain being evened out. Crop arrivals from different producing countries at a regular interval. While the Vietnamese crop is due to arrive in March,Malaysian pepper will flow in April-May followed by Indonesia and Brazil. "This ensures a steady supply chain removing temporary shortages in the international market," Vidyasagar said.

He, however, added that the international market had so far not experienced an over supply situation as the growers are holding on to their crop expecting higher prices. "The growers used for higher prices during the past two years are releasing pepper only in small quantity," Vidsyasagar said.

Following the higher prices, pepper exports this year was likely to be lower compared to the last year's performance, he added.

Vidyasagar said the Brazilian currency crisis did not have much of an impact on the Indian pepper prices as the Latin American country was left with a stock of only less than 2,500 tonnes to be released to the market.