The exports of agricultural products worth billion dollars slide down

In contrast to the positive growth in the export of agriculture, forestry and fishery in general, from the beginning of the year, the export value of key agricultural products has fallen.

One of the important reasons that tea export is less competitive is no built brand. Photo: N. Thanh.

Export value fell sharply

In the past, pepper, coffee and tea, are key agricultural products for export of Vietnam, earning $US billion each year. However, in the first quarter of the year, the export situation is dark as the value fell sharply compared to the same period in the last year.

Statistics of the Ministry of Agriculture and Rural Development show: in accumulating to the end-March, the export of pepper is estimated at 54,000 tons and $US 203 billion, increasing by 5.5% in volume but decreasing 37.3% in value compared to the same period the last year. The average price of pepper export in the first two months of the year only reached $US 3,822 per ton, falling by 44.7% compared to the same period the last year. The biggest pepper exporters in the first two months of the year are the US, India, Pakistan, United Arab Emirates with 43.5% of market share. In the domestic market, pepper price fell sharply in March with a decrease of 9,000 -10,000 VND per kg. Pepper price in Dac Lak – Dac Nong, Giai Lai is now at 54,000 VND/kg. Pepper price in Ba Ria Vung Tau and Dong Nai is 54,000 VND. These prices are 2 times lower than in the same period of last year, 4 times lower than in the mid-2016, and are the lowest price over the past 5 years.

In the first quarter, the export of coffee is not positive as the estimation is at 520,000 tons worth $US 1 billion, increasing by 15.1% in volume but reducing by 1.7% in value compared to the same period the last year. Similar to pepper, the average export price of coffee in the first two months also decreased, reaching $US 1,945 per ton, falling by 14.2% compared to the same period in 2017. In the domestic market, the coffee price in the first quarter fell by 100-300 VND/kg compared to the same period the last year.

Tea also decreased along with pepper and coffee export prices. In the first three months, the export of tea is estimated at 25,000 tons worth $US 39 million, decreasing by 9.7% in volume and by 4.1% in value compared to the same period in 2017. However, the average price of tea in the first two months is more positive as it reached $US 1,559 per ton, increasing by 6.2% compared to the same period in 2017.

Supply overcome demand, low quality

Answering questions from the Customs News on the decrease of exports, Tran Van Cong, Deputy Head of Department of Agro Processing and Market Development Authority (MARD), said that: for coffee, in the first quarter, the global price of coffee reduced by 14% compared to the same period in the last year, affecting Vietnam’s coffee price. Besides, some large countries processing coffee, such as Brazil, Indonesia, are preparing for the harvest season. The sign of abundant supply has both increased the supply in the world and effected coffee price. “The subjective reason affecting the decrease of coffee export in the first 3 months is quality. Though Vietnam has good coffee, some stages are not good, especially the harvesting, drying and processing is not guaranteed”, said Mr. Cong.

For tea products, according to him, along with the fact that the supply overcomes the demand, it is also due to the low quality of Vietnam’s tea products, which have no brand name in the international market. At present, the export of tea mainly depends on Pakistani market. Meanwhile this market lacks political stability, affecting the demand. In addition, some other export markets such as China and Taiwan, have had big changes, giving stricter requirements on quality, and this has also accounted for a decrease in the export of tea.

For pepper alone, Mr. Cong analyzed clearly. The fall in pepper price is due to the large over-planning of production. Currently, pepper area has actually exceeded by 3 times to the planned area. Besides, despite a high productivity compared to other countries, Vietnam’s pepper quality is unstable, affecting Vietnam’s pepper price.

According to Mr. Cong, in the coming time, the global coffee market will be affected directly from the global supply. It is predicted that the coffee price will be hard to increase. Enterprises will find it difficult to set a high selling price. Thus, the purchase of temporary storage coffee should be calculated carefully.

About pepper, Mr. Cong said that, the MARD will focus on the diversification of products, promote processing and building brand, especially developing linkage models between scientists, farmers and enterprises, to have more processing resources, and to increase value in the coming time.

Regarding the story of sustainable development of "black gold" - pepper, Deputy Director General of the Cultivation Department (MARD) Le Van Duc added: for the area of pepper cultivation, in order to manage closely, the MARD will request localities to review the whole area of pepper, propagandize and mobilize farmers not to increase the area of new planting; stop reforestation for old and seriously infected areas; identify appropriate crops to guide farmers to switch to other crops for better effectiveness.

In the long term, in order to improve the competitiveness of coffee sector, along with the project of re-cultivation, some solutions are to be carried out, such as building a national product development project with high quality coffee; focusing on completing the value chain, building brand, ensuring 50% of leading enterprises labeling Vietnamese coffee brand when exporting. Also, for tea products, the MARD is focusing on building and developing Vietnamese tea brand, improving quality and entering to the higher segments”, said Tran Van Cong, Deputy Head of Department of Agro Processing and Market Development Authority (MARD).