The shortage of capital in the country is now affecting the agricultural sector.

A report from the Vietnam Cashew Association said although several companies' operational capacity had doubled, domestic raw cashew volume was not predicted to increase this year.

Cashew companies are importing raw cashews to meet the sector's demand. The sector needed about 10 trillion VND (476 million USD) to buy raw materials from farmers and 12 trillion VND (571 million USD) to import the needed cashews, the association said.

In the past, a company could import 5,000 tonnes of raw cashew with 100 billion VND (4.7 million USD), said chairman of the Vietnam Cashew Association Nguyen Thai Hoc, which was not the case anymore due to inflation.

Chairman of the Vietnam Coffee and Cocoa Association Luong Van Tu said foreign companies were pouring money into their sector to buy raw material in Vietnam because the price of the commodity was cheaper here than on the world market.

Agriculture companies that export their products said that they also needed capital to buy raw materials.

If the companies do not have enough money, then their material will be sold to foreign companies in Vietnam .

Meanwhile, bank loan limits for agriculture companies this year has not been readjusted.

Do Ha Nam , an official from Intimex Import-Export Joint Stock Company in HCM City , said this year due to the higher price for many agricultural products, capital demand from agricultural companies was two to three times higher than in the past.

The price of coffee on the domestic market nearly doubled this year, standing at about VND49 million ($2,300) per tonne. Pepper prices increased three fold and the price of raw cashews jumped by 150 percent./.