The Government should support sustainable development of the coffee industry with preferential loans for exporters and those who purchase coffee for storage, says Viet Nam Coffee and Cocoa Association.

At a meeting held in HCM City on Saturday to set directions for the next three years (2011-13), the association also said it strengthen promotions targeting new markets including China, ASEAN members and Canada.

It will also aim at having domestic consumption account for 10-15 per cent of total coffee production in the country within five years.

The association said it would strengthen co-operative links with large coffee-growing countries like Brazil, Colombia, Indonesia and India to learn from their experiences in production and processing.

It will also collaborate with the Ministry of Agriculture and Rural Development and local authorities in requesting the Government to restructure coffee production in the country.

Under this plan, Arabica coffee would be grown in high altitude plantations instead of Robusta, because the former fetches returns 2-2.5 times higher than the latter variety.

The association said at the meeting that it will support businesses in applying advanced technology to increase productivity, encourage research as well as the cultivation of new coffee varieties.

By increasing cultivation area and yield, the association aims at Vietnamese coffee having a 13-15 per cent share of the world market, it said.

Quality concerns

Do Van Nam, vice chairman of association, said at the meeting that Vietnamese coffee exporters face many challenges in becoming more competitive in the world market.

“Coffee quality is still a worrying problem and needs a lot of attention. Some farmers are picking unripe beans and not following regulations in collecting and processing,” he said.

The coffee industry is yet to pay sufficient attention to getting international standard certification, including the UTZ – a set of social and environmental criteria for responsible coffee-growing practices and efficient farm management – that would help increase the competitiveness of Vietnamese coffee in the world market.

“Currently, close links have not been established between exporters, and between exporters and producers to create more added value for our coffee products,” he said.

Another problem facing the sector what that its human resource base lacked a thorough understanding of scientific and technological advances in the sector as well as the latest market information. This prevented them from timely analysis and assessments of market trends to avoid risks and losses.

The high interest rates at present have made it difficult for firms to access loans and this in turn has lowered their business efficiency, the meeting heard.

Moreover, Viet Nam was yet to build a trademark and brand identity for its coffee in the world market with special and unique products, experts said at the meeting.

They said most coffee plantations are small-scale operations that do not allow the sector to benefit from economies of scale.

Vietnamese coffee is exported to more than 80 countries and territories. Key importers are Germany, United States, Italy, Belgium, Spain, Japan, Holland, Korea, France and England.

Meanwhile, the cocoa growing area in Viet Nam is expected to reach 33,500ha by 2015, Nam said. Of this area, 23,000ha would be used for commercial purposes with an output of one tonne per ha. Last year, Viet Nam exported about 2,000 tonnes of cocoa.

Cocoa plantations have bright future prospects because domestic and foreign consumption is forecast to increase of the next five to 10 years, Nam said.

Source: VNS