Tea exports have positive signs.

Pakistan is now the biggest tea importer of Vietnam. Picture: ST.

Be elated with the US

According to the Ministry of Agriculture and Rural Development (MARD): accumulated in the first 11 months of the year, the export volume of tea reached 118 thousand tons and $US 197 million, rose by 7.1% of the volume and 4.3% of the value compared to the same period in 2015. In the first 10 months of 2016, the export volume of tea to Pakistan – the biggest market of Vietnam with 33.5% of the market share rose 1.8% of the volume but reduced by 8.7% of the value compare the same period in the last year. The tea export markets which had value rose sharply are China (2.09 times higher), Indonesia (2.01 times higher), and Malaysia (increased by 44.7%) compared to the same period in the last year.

Commenting on tea export issue, notably in the export markets, Ms. Nguyen Thi Anh Hong, vice President of the Vietnam Tea Association (Vitas) said: tea export has changed markedly, despite the difficulties at the beginning of the year, it is considered relatively good at the end of the year. The export to many markets has euphoria. Notably, the tea industry has reached a positive result, changed in promoting tea products to export and consume in the US. In the market, Vietnamese tea mainly develops high-end products.

“The biggest issue of exporting tea into the US is the difference between the market and EU. Meanwhile EU only sets the Maximum Residue Level for active substances in products, the US has given 6 kinds of banned substances in tea products. The latest examine results show that Vietnamese contained two of six kinds of banned substances in the US. In order to solve this problem, Vitas is collaborating with the Department of Horticulture (under MARD) and the Plant Protection Department (under MARD) to establish Plant protection groups. Accordingly, through the activities of the plant protection group, factories of enterprises will select, remove the old pesticides which contain the banned substances in the US, and apply the new pesticides which are more suitable for using”, Ms. Hong said.

According to Ms. Hong, this model is applied in nearly 20 tea enterprises but the result is only 50/50. The cause is that plant protection product management has many shortcomings. Many pesticides are sold, the label claims incorrect ingredients, and active substances inside. Some cases which the label claims without banned substances, but when the sample was taken to examine found banned substances. “In order to help the tea industry get more advantage in exporting to the US, we suggest the State management agencies enhance tightly pesticide management. Besides, in the promoting trade stage, for tea products, Vitas suggests that the MARD concentrate on the US market. The promoting trade programs to the US allow the representatives of the tea industry taking part in”, Ms. Hong emphasised.

Anxious with China

A part from the US, the tea exports have seen many positive signs in important markets such as ASEAN, Pakistan, Taiwan (China). According to Ms. Hong, ASEAN plays gradually an important market of our tea industry. Over 5 years, Indonesia, Malaysia, Singapore are the three countries in the top 10 of our tea industry. The characteristics of those markets is to divide into several quality levels. For example, Indonesia imports low quality, while the two countries left import high quality levels. In the 3 countries, only Indonesia actually consumes more tea. The rest mainly is the transshipment markets. Beside the 3 markets above, the emerging markets in the ASEAN has Thailand imports a large volume of Vietnamese tea.

“Vietnam’s biggest tea import market is Pakistan still maintains in the stability. For Taiwan (China), we have faced many difficulties for a year ago due to the problem of residues of plant protection productions, but now has been resolved. After working with the Agro-aqua forestry Quality Asssuarance Department (under MARD), Taiwan raised the Maximum residue level instead of the previous levels, helping to remove the difficulties in tea exports, especially in exporting jasmine tea into the market”, Ms. Hong said.

China is a big and the most important market in the Vietnamese tea exports has seen the euphoria in the year. However, Vitas recognizes there are still many anxieties and worries when exporting tea into the “neighbour” country. Over the years, China has imported tea unstably. This year, the “scenario” is similar as there are some items that the market did not buy at the beginning of the year but purchased massively at the end of the year. The consume trend of Chinese market is hard to catch.

Ms. Hong said: Chinese market’s characteristics, tea is the product can be bought and stored, thus, Vitas always defined it as an important market and can not be ignored even though tea is only exported to China by non commercial goods. It is can not export by commercial goods because China has rules, many products buy from Vietnam in general, tea in particular always let its province near Vietnam border to buy. If export enterprises sign the sale contract with partners in Beijing or Shanghai, during the direct negotiations, the partners will give some barriers that make the deal fail, while the same product is exported in unofficial trade is smoothy. “From the fact, according to Vitas, about the issue of tea export into China, exporting through unofficial trade need to be considered carefully and have a specific strategy to ensure the stability in export as well as the benefits of enterprises”, Ms. Hong emphrasised.

According to the MARD: in the domestic market, Thai Nguyen and Lam Dong tea raw materials market remains stable in November 2016. In Thai Nguyen Province, the dry green tea bud price is at 100,000 vnd/kg; high quality tea leaves price is 180,000 vnd/kg, and the dry green tea bud price (preliminary processed products type 1) is 130,000 vnd/kg. In Bao Loc (Lam Dong province), tea raw materials price (fresh buds) to produce green tea type 1 remains stably at 7,500 vnd/kg; tea raw materials to produce black tea is at 3,500 vnd/kg.