KUCHING: Global pepper prices are expected to trend upward in 2026 in view of continued tight supply as demand is outstripping supply.
William SC Yii, director of leading pepper exporter Nguong Aik (Kuching) Sdn Bhd foresees the current global pepper prices will either be maintained or go up by 10% to 15% from current levels.
“The global white pepper now fetches between US$11,500 and US$12,200 per tonne and black pepper between US$8,300 and US$9,000 per tonne,” he said.
There are six active pepper exporters in Malaysia, mostly in Kuching and Sarikei in Sarawak, which contribute more than 95% of Malaysia’s pepper production.
Yii said the global supply is declining as major producing countries are having lower new crop production, but more demand for the spice is coming in from overseas buyers.
“Currently, there is a world supply shortage of pepper against demand because there is increased buying from overseas importers.
“Importers in the United States did not buy much in 2024 because the prices had surged and were high.
“They bought more last year, as their inventories are running very low and after realising that the prices are not coming down but are on an uptrend instead.
“They have bought forward to 2026 and until 2027,” he told StarBiz.
He said importers of forward buying have to pay a premium for the pepper prices, as they are required to pay for the storage fee for the spice.
Similarly, Yii said China importers increased pepper purchases last year as compared to 2024 due to the slowdown of their economy and also because of the low inventory.
He said the United States and China mainly sourced their pepper from Vietnam, the world’s No 1 producer and exporter of the spice.
According to the Vietnam Pepper and Spice Association, Vietnam exported 247,482 tonnes of pepper valued at US1.66bil in 2025, the highest level in terms of value ever recorded for the spice, and jumped by 26% in value year-on-year (y-o-y), reflecting sharply higher prices even though export volume dipped by 1.2% y-o-y.
Though pepper exports to the US fell nearly 24% y-o-y due to the impact of reciprocal tariffs, the United States remained Vietnam’s largest buyer in 2025 with 55,082 tonnes, accounting for 22.3% of Vietnam’s total pepper exports for the year.
Vietnam’s other major markets were United Arab Emirates, China, India and Germany.
And in January 2026, Vietnam’s pepper exports surged to 21,743 tonnes worth US$139mil, marking a 66.2% increase in volume from a year ago and reflecting the strong market recovery from the beginning of the year.
The United States absorbed 5,154 tonnes (23.7% of Vietnam’s total exports) down 17.3% from the previous month (December 2025) but China raised the imports sharply by 53.2% to 3,339 tonnes (15.4%) month-on-month, showing a strong comeback.
The IPC forecasts that the global pepper market will continue to grow, driven by increasing demand from various industries.
The market is expected to experience a compound annual growth rate of 6.2% from 2021 to 2026.
Key market drivers include rising disposable incomes, changing consumer preferences, and the growing popularity of ethnic foods.
On Malaysian pepper, Yii said although the published prices by the Malaysian Pepper Board have come down as compared to a year ago, the prices of Sarawak Pepper (brand name for Malaysian pepper) have been stable in its traditional markets due to the tight supply.
Last week.the board’s published average for Betong black pepper (Grade 1) was RM26,250 per tonne against RM30,000 per tonne a year ago, while the average white pepper (Grade 1) was RM36,890 per tonne, down from about RM40,000 per tonne in February 2025.
Betong pepper fetches the highest price in Sarawak.
Japan is Malaysia’s largest pepper export market, accounting for about 50% of the country’s export volume, and the other main markets are China, South Korea and Sweden.Sarawak Pepper fetches a premium in the global market because of its superior quality.
There is a gap of about US$1,000 per tonne between Malaysian and Vietnamese pepper. In December, Plantation and Commodities Minister Datuk Seri Noraini Ahmad said Malaysia’s pepper production for 2025 was expected to reach 32,000 tonnes.
Yii estimates that Malaysia’s carry-over pepper stock in 2025 is about 3,000 tonnes, slightly higher than the previous years, as smallholder pepper farmers are holding on to their stocks, hoping to sell at higher prices.
On the strengthening of the ringgit against the US dollar in recent months, Yii said the strong ringgit is a disadvantage to Malaysian pepper exporters as it erodes their profit margins, adding:” exporters may incur some foreign exchange losses.
“In 2025, the ringgit appreciated by 10.2% against the US dollar to RM4.057 per US dollar, and it has further strengthened to about RM3.91/US dollar this year.
“Looking ahead, Yii cautions that as global pepper prices have gone up since 2021/2022, this year’s market is critical, as based on technical charts and cycles, a correction might set in.
“If the market corrects, the price consolidation may take four to five years,” he predicted.
