Black pepper is trading at Rs 700 to Rs 710 a kilogram in Kerala, its highest price in more than a decade. The figures come from market data reported this week by the Malayalam outlets Janmabhumi and Manorama Karshakasree. The last comparable peak came in 2014-15, when dried pepper touched roughly Rs 740 a kilogram. A decade-long slide followed, dragging prices down to about Rs 340 a kilogram by 2019.
The rally has built gradually since 2021. Traders say the past few weeks have pushed prices past anything seen since that earlier peak. Farmers in Kerala, Tamil Nadu and Karnataka grow most of India’s pepper, and many are watching the surge from an awkward position. They simply have too little pepper left in store to sell into it.
Pepper is one of Kerala’s oldest cash crops. A sustained price recovery matters well beyond individual farm accounts, since pepper still anchors export earnings and trading networks reaching from highland holdings to coastal ports.
How the shortage built up
Kerala’s harvest has fallen for a mix of reasons that built up over several years rather than one bad season. Disease outbreaks have cut yields on ageing vines across the state’s traditional growing belts. Below-average rainfall in recent seasons added further strain. Many smallholders abandoned pepper cultivation altogether during the years of depressed prices, switching to other crops rather than keep absorbing losses. That earlier exodus from the crop is now limiting how much of today’s price rise actually reaches growers.
Imports have compounded the squeeze. Vietnam, Sri Lanka and Brazil supplied cheap pepper into the Indian market through the second half of the last decade. That flow was large enough to drag domestic prices down to their 2019 low. Import volumes from all three have thinned sharply since then, removing the ceiling that cheap foreign pepper once placed on Kerala’s crop. Traders describe the current market as unusually thin on both sides. Buyers are competing for limited stock, while sellers with pepper in hand have little incentive to release it while prices keep climbing.
Festival demand adds to the squeeze
Seasonal buying is doing the rest. North Indian traders restock spices every year in the run-up to Diwali, and this year’s festival demand has landed on an already tight market. Traders expect Vietnamese, Sri Lankan and Brazilian shipments to pick back up, since Kerala’s elevated prices now make imported pepper competitive again. That shift would eventually cap further gains in the domestic price.
For now, the price signal is not converting cleanly into farm income. Some growers sold their stock earlier in the season. Others simply have little left after years of reduced output. Both groups are largely watching this rally from the sidelines rather than benefiting from it directly. The gap between the headline price and what reaches individual farms is likely to shape how the state’s agriculture department handles pepper policy over the coming months.
That gap also shapes who decides to replant pepper on land that shifted to other crops during the years of lower prices. A price this high, sustained over several seasons rather than one, would give smallholders a clearer reason to bring abandoned vines back into production. A shorter-lived spike driven mainly by tight festival-season stock is less likely to change planting decisions. Farmers who have already diversified into other crops tend to weigh several years of price history before committing land back to pepper.
Pepper’s swings reach beyond the spice trade. Kerala’s Ayurveda practitioners have long used the same peppercorns as a base ingredient in traditional formulations. That link ties the state’s oldest export crop to the wellness sector marking Ayurveda Day this week. State officials are separately weighing how new eco-sensitive-area rules for the Western Ghats, Kerala’s main pepper-growing hill tracts, might affect local farmers. Many have already spent years absorbing price volatility they cannot control.
