Towards the Establishment of Vietnam Coffee Coordination Committee

Speaking at the conference, Mr Luong Van Tu, Chairman of the Vietnam Coffee and Cocoa Association (Vicofa), said that within less than two decades, Vietnam rose to second place in global coffee trade and the first place in robusta coffee production in the world. In 1961, the country had just 21,200 ha of coffee farms, but the acreage has now jumped to over 614,500 ha. The average yield is 2.32 tonnes per hectare. The export volume approximated 1.7 million tonnes worth US$3.74 billion. This is a gigantic step for the Vietnamese coffee sector, making it a major contributor to the country’s agricultural export. Especially in the Central Highlands, the coffee sector has contributed 10 per cent of agriculture GDP in the past years, generated more than one million jobs, and provided sources of revenue for 50 per cent of Central Highlands people.

 

However, the development of Vietnam's coffee is currently facing numerous challenges arising from planting, care, processing and export. These challenges are forecast to be more difficult in the upcoming period. The biggest concern is that ageing coffee trees, of over 20 years, account for 30 per cent of total coffee area. Without a timely and appropriate replanting, this figure will grow to 50 per cent and Vietnam will be no longer the second largest coffee exporter in the world. In addition, although the coffee acreage is vast, it is scattered, leading to greater hardships for applying planting and processing techniques. At present, Vietnam has more than 150 coffee exporters but their quality is not stable. A majority of coffee exported is not fully processed, but produced in small scale and lacks quality certification. Vietnam also has not set up any programme to study climate change and environmental impacts on its coffee industry. This reality calls for the active involvement of various sectors to support the sustainable development of the coffee industry.

 

Mr Tu said, to sustainably develop, the Vietnamese coffee industry needs a stable farming area of 500,000 ha with annual output of 1 - 1.1 million tonnes, exports of 1 million tonnes of coffee beans, keeping 15 per cent of the world’s market share, and to raise domestic consumption to 10 - 15 per cent of the total coffee production output. Especially, exporters need to expand into high potential markets such as China and ASEAN in order to gradually increase earnings. He said that to boost export coffee value, Vietnam must apply advanced technical standards to cultivation, harvesting and processing in order to reduce the proportion of simply processed products.

 

Speaking at the conference, Minister of Agriculture and Rural Development Cao Duc Phat added that coffee is a strategic agricultural commodity of Vietnam and carries special importance for the Central Highlands. Therefore, the sustainable and efficient development of this sector is of urgent and vital importance. He suggested that the coffee industry set up a committee in charge of coordinating the development and renovation of the Vietnamese coffee industry. Referring to the organisational structure of the Vietnam Coffee Coordination Committee, Dr Dang Kim Son, Director of the Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD), said the committee must include coffee farmers’ associations, and domestic and international traders and processors. This committee’s functions and tasks are to build, coordinate and monitor policy enforcement, coordinate the unification of the coffee industry, grant quality certifications, regulate and develop the market to ensure supply - demand balance, operate the Coffee Research and Development Fund, represent the Vietnamese Government to address international issues related to coffee, and arbitrate coffee-related disputes. The formation of this organisation promises to solve existing problems in coffee production, especially scattered production and direct competitiveness among local firms.