Despite being a major tea producer, Vietnam has been urged to restructure its tea industry to enhance its competitiveness and foster sustainable development. Report by the Vietnam Economic News.

Vietnam's tea export ranks fifth in the world in terms of production but only 10th in terms of sale prices. It is estimated that Vietnam's tea exports in 2013 will see a significant decline, up to 20 percent due to the poor quality of its tea products.

According to the Ministry of Agriculture and Rural Development, the tea export in September reached 13,000 tonnes, worth nearly 21 million USD. In the first nine months of the year, Vietnam exported 101,000 tonnes, earning 161 million USD and representing a 4.2 percent decrease compared with the same period last year. It is estimated that tea production and exports in 2013 will reduce by 20 percent year-on-year.

Chairman of the Vietnam Tea Association Doan Anh Tuan said although Vietnamese tea is still exported to a number of markets such as the US, Belarus and Indonesia, exports to traditional market like the EU are facing many difficulties such as technical and quality barriers.

There are many reasons for the Vietnamese tea export decline. However, the basic factor is the quality. Therefore, despite Vietnam’s fifth position among the global tea producers, its export revenue ranks only 10th. While Vietnam exports tea at 1.45 USD per kg, many European countries import the products and re-export them at a price of nearly 10 USD per kg.

Dr Nguyen Quoc Vong from the Management Board of agricultural projects, Ministry of Agriculture and Rural Development, said Vietnam’s tea export value per hectare is low, only over 1,200 USD per hectare, much lower than Sri Lanka (5,700 USD per ha) and Kenya (6,000 USD per ha).

According to Nguyen Xuan Hoa, deputy head of the Agro-forestry Processing and Salt Industry Department under the Ministry of Agriculture and Rural Development, to achieve a sustainable tea industry, Vietnam needs to promote coordination in tea production between farmers and farmers, farmers and enterprises.

In addition, it needs to pay attention to the planning of tea growing regions to increase productivity, quality and safety of the tea materials; rearrange the tea processing plants and ensure that they have a coordination with tea material regions and apply the Good Manufacturing Practice (GMP).

In reality, the number of tea processing plants is growing rapidly, resulting in lack of high quality materials as the plants are willing to buy the materials at all levels of quality. This will discourage the growers to produce high-quality tea and therefore result in lower quality of Vietnamese tea products.

Apart from launching trade promotion and trademark advertising programmes, tea enterprises should also promote domestic consumption as this is a large and potential market. On the other hand, the tea growing areas meeting VietGap standards remain low, therefore, in order to improve the quality of material sources, the State should adopt policies to encourage growers and enterprises to produce tea following Good Agricultural Practices (GAP) models.-VNA