(VOV) -An overabundance of certified coffee flooding the global marketplace is heading up the longest slump in coffee prices in decades, say leading market analysts.
The export price of certified coffee generally has historically hovered about US$300/tonne higher than non-certified coffee says Vu Dinh Noi, deputy general director of Thang Loi Coffee Company.
Our company currently has in excess of 1,200 hectares of coffee in cultivation under the UTZ Certified and Rain Forest certifications in the Central Highland province of Dak Lak.
However, last season international certified coffee comprised more than 50% of Vietnam’s total output, which surpassed the set target by the Ministry of Agriculture and Rural Development (MARD).
The oversupply caused the price of export certified coffee to decline and our profits to plummet accordingly, Noi adds.
There are four kinds of certified coffee, namely 4C, UTZ, RFA, and Fairtrade. To date, certified coffee has accounted for roughly 1/3 of the nation’s total cultivation area, making up 58% of Dak Lak province’s total coffee production.
International certified coffee helps domestic businesses and farmers benefit from higher prices and improves the prestige and competitiveness of Vietnam’s coffee sector in the global market says Trinh Duc Minh, Vice Chairman of the Buon Ma Thuot Coffee Association.
However, he agrees with Noi and says that overproduction is hurting the coffee industry and businesses are more often than not finding it hard to sell high-quality coffee at a reasonably profitable price in the global market.
Minh suggests that coffee producers across the country work more cohesively to set appropriate targets for certified coffee production so that this kind of product can generate a higher source of income for producers and exporters.
Dr. Le Ngoc Bau, Head of the Tay Nguyen Agriculture and Forestry Science Institute, in turn, affirms that Vietnamese certified coffee faces a number of difficulties in achieving an equitable price in the global marketplace.
Vietnam, he noted, like coffee producers from many other nations, confronts the all too familiar dilemma of too much product on the market. Once, the supply vs. demand threshold is reached the price drops and those in the industry suffer losses due to low export prices.
Bau believes more sophisticated forecasting and prediction methods should be implemented, providing local businesses in the industry with more timely and accurate analysis so they can adjust their production accordingly.
It is essential to create a closer link between exporters and farmers and have accurate forecasts, with a view to regulating the quantities of coffee to be exported to avoid excessively high inventory levels, Bau concludes.
Đăng ký: VietNam News