Vietnam attempts to increase export value of coffee

HANOI, Aug. 18 (Xinhua) — Vietnam, one of the world’s
largest coffee exporters, is now striving to lift export value of
coffee, as most of the country’s exported coffee was unprocessed,
bringing little profit.

Over the past decade, Vietnam has witnessed a surge in coffee
cultivation areas, productivity and output. In 2012, Vietnam’s coffee
output hit 1.3 million tons, 14 times higher than that of 1990 while
export revenue reached 2.7 billion U.S. dollars, 29 times higher than
1990.

In April, 2014, Vietnam Coffee-Cocoa Association (VICOFA)
forecast the country will sell some 1.5 million tons of coffee to world
market in 2014 to earn 3 billion U.S. dollars.

Vietnam’s coffee has been shipped to over 80 countries and regions worldwide, said VICOFA.

A report on evaluating Vietnam’s export potentials released by
the Vietnam’s Ministry of Industry and Trade late July showed that
Vietnamese coffee has high competition thanks to suitable environment
and climate conditions, low production cost, and high output. However,
the quality of Vietnamese coffee remains low due to poor processing,
drying equipment and outdated harvesting technology.

Besides, the brand of Vietnamese coffee is not widely recognized while the country’s exporters lack marketing skills.

With these weaknesses, Vietnamese coffee is usually sold at lower
price than average world price, said Bao Hai Quan (Customs News), an
online newspaper of Vietnam Customs on Monday.

Nguyen Trong Thua, head of the Agro-Forestry Processing and Salt
Industry Department under Vietnam’s Ministry of Agriculture and Rural
Development (MARD) was quoted by Bao Hai Quan on Monday as saying that
only 5 percent of total Vietnam’s coffee export volume was processed.

Thua attributed this fact to ineffective processing and preserving system of Vietnam.

“The weakest point of the coffee sector is lack of connectivity
among production, processing, preserving stages and loose link between
farmers and enterprises,” assessed Thua.

Recently, MARD assigned the Agro-Forestry Processing and Salt
Industry Department to draft plans on coffee processing and preserving
system till 2020 with its orientation to 2030.

According to the draft, there will be more export potentials for
the sector if Vietnamese coffee is processed by advanced technology,
meets high criteria of quality and has feasible marketing strategy, said
Thua.

The draft maps out measures to step by step increase export value
of Vietnamese coffee by building high-quality coffee production areas,
said the official, adding that exporting companies should coordinate
with localities to seek stable coffee production areas, and sign
contracts of buying products.

In addition, trade promotion activities and market expanding efforts should be further enhanced, said Thua.

The draft set a target that by 2020, export revenue for
Vietnamese coffee will reach 3.5 billion U.S. dollars annually, while
100 percent of processed coffee will meet with national and
international criteria on hygiene and food safety.

The rate of processed coffee is set to reach 40 percent in 2015,
and 70 percent in 2020, from the current five percent of the total
coffee export volume.

According to statistics by MARD, in the first seven months of
2014, Vietnam exported some 1.12 million tons of coffee, pocketing 2.31
billion U.S. dollars, up 26.9 percent in volume and 21.9 percent in
value year-on-year.

Average export price of Vietnamese coffee during the period was 2,043 U.S. dollars per ton, down 4.84 percent year-on-year.

Germany and the United States continued to be the major importers
of Vietnam’s coffee with respective market shares of 14. 02 percent and
10.1 percent during the period.

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