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======
REPORT
ON TEA SECTOR IN VIETNAM
(Bo co ngnh hng Ch Vit Nam)
n v t vn:
Trung tm o to- Nghin cu Khoa hc
T chc v Qun l
a ch: 126/68 Phan K Bnh - Ba nh- H Ni
in thoi: 04-7624464; 04-7624911
n v thc hin:
Cng ty C phn Truyn thng Quc t IQ
a ch: 88 Hng Trng, Qun Hon Kim, H Ni
in thoi: 04-8288406
- Hanoi, 2007 -
TABLE OF CONTENTS
I. Overview
1. Introduction to products mentioned in the report
2. General information of the sector
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3
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4
4
4
5
7
8
8
9
9
9
10
10
11
12
12
12
12
15
17
19
V. Import situation
21
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I. Overview
1. Introduction to products mentioned in the report
This report is namely concerned with Vietnam tea for import and export,
including input products which are materials used for the business and
operation activities of the sector, and other key products such as green tea,
black tea, oolong tea, etc
Midland region includes provinces of Vinh Phu, Bac Ninh, Bac Giang,
Ha Tay, Hoa Binh, Bac Can and Thai Nguyen. These are provinces
that produce most of tea with yield covering 70% of the total tea yield of
the North. The main tea variety grown in this region is Trung Du (a
variety from China and with big leaves) which has high yield and good
quality. Main products are black tea and green tea for domestic
consumption and export.
The lower region where green tea is grown includes provinces in the
Northern Delta and the former 4th region. The local people here have a
habit of using tea for fresh drink (without processing it).
In the South, the tea is grown namely in Lam Dong and Gia Lai - Kon Tum.
The Southern Highland (Lam Dong province) is a tropical area with altitude of
800 - 1.500 m above sea level, is thus appropriate for Shan tea. The Northern
Highland is rather low (from 500 - 700m), and the climate is suitable for
varieties Atxam and Trung Du tea.
Areas for growing tea materials are also where tea processing unit and
finished tea production units are located.
Green tea: green tea with natural flavor and those with flowers such as
Jessamine, lotus, etc.
Oolong tea: with special tea types which are imported from China and
Taiwan and experimented by growing in big deal in Moc Chau and Lam
Dong highland; together with Oolong tea production line of Vietnam;
this product of Vietnam has quality as good as Oolong tea made in
China and Taiwan with special features of this tea type. Oolong tea is
shining yellow in color, strong taste and special flavor.
Black tea: with modern production lines, Vietnam can produce all
types of this tea (Orthordox, CTC) with good quality and better and has
exported to many markets in the world.
Boiled tea: features: transparently green water, soft taste and teas
special natural flavor; it may be embalmed or not. This product is
consumed at home and in countries in East Asia.
Fried tea: strong taste, can be used as materials for embalmed tea.
This product is now consumed at the domestic market.
Dries-boiled tea: in helical round shape, green water, strong taste and
beloved to drink in the Asian market.
capacity was only 3,5% per annum and 3,1%/ per annum respectively. In
2003 the yield reduced much while the market collapsed due to the war in Iraq.
Up to now, Vietnam tea is at 5th position of the world in term of area, and
becomes key economic tree. Tea growing has been the traditional job of
many villages. At present, 34 provinces and cities nationwide spend 125,000
ha of their cultivation area for growing tea, increasing 47,700 ha compared
with that in 1999 (63,8%); of which area for finished tea products is 101,700
ha. For the phase 1996-2006 the average growth speed of tea was 6.2% per
annum. In 20 provinces of national tea growing area, there are 240 industrial
processing units, with total capacity of more than 3,100 ton fresh buds per
diem (600,000 ton fresh buds per annum).
By 2007, there have been 630 units and processing factories in 34 provinces
and cities with capacity increasing by two times, reaching 50 tons per ha.
Every year, the raw tea yield reaches 577 thousand tons. Area for
multiplication of new tea varieties with high yield and good quality covers
32.5% of total area.
Area and yield of tea of Vietnam for the phase of 1995 - 2007
600
500
400
300
200
100
0
20
on
06
th
s
20
07
05
20
04
20
03
20
02
20
01
20
00
20
99
1000 ha
1000 tons
19
98
19
97
19
96
19
19
95
140
120
100
80
60
40
20
0
Tea capacity of Vietnam depends much on tea varieties, care techniques and
ecological conditions. On average, traditional tea varieties in the midland
(Trung du tea) has capacity of 4 ton per ha, traditional highland tea varieties
(Shan tea) reach 5,5 ton per ha, whilst improved tea varieties (PH1) give
capacity of about 6,5 ton per ha. Of course, this also depends on land where
tea is grown; normal capacity is often remarkably higher than average level in
the highland where the geographical condition is suitable with tea.
In Ha Tay, with the target of building trade nam Ba Vi tea, the locality
has set up policy of expanding the production region. To widen tea
garden, it is planning Ba Trai tea production area in order to meet the
demand of processing 2,700 ton of dried bud tea per annum. In
addition, province also plans Minh Quang tea region, Khanh Thuong
tea region which can produce from 1000 tons to 1200 ton of dried bud
tea per annum; Van Hoa tea region, Yen Hoa, Viet-Mong farm have
yield of fresh bud tea of 9000 tons, dried bud tea of 2000 tons per
annum. Other hilly regions such as Thuy AN, Cam Thuong, Suoi Hai
farm intend to produce from 2500 ton to 3000 ton of fresh bud tea, and
500 ton of dried bud tea per annum. In parallel with production
expansion, advanced processing equipments are also applied. If
former production method was by hands; now most of household
growing tea use tea drying machine and tea rubbing machine with
capacity at 5 -7 times higher than previously.
At present, Thai Nguyen province has more than 15,000 ha of tea for
trade. Thanks to the application of science and technology advances
into growing, caring, processing processes, capacity and quality of tea
are more and more improved, meeting the current domestic and
foreign consumption demand. Only for the first 6 months of year 2006,
tea yield of the whole province reached 36,432 ton of fresh tea,
equivalent to 7,286 tons of dried bud tea (about 70% yield was
processed with industrial and exporting method). The fact that
enterprises speed up tea export activity helps create good condition for
the peasants in term of a stable market for tea consumption.
In 2007, Phu Tho province continues to instruct tea companies and tea
processing companies to apply method above and investment in depth
into growing new tea. Province continues planning area for tea
production, trying to reach 500 new production ha by the early 2007.
Now the municipal tea development program has two projects: AFD tea
development project managed by the Municipal Department of
Planning and Investment; and ABD tea project managed and
developed by Municipal Department of Agriculture and Rural
Development by deploying supporting information and techniques for
the peasants, and lending for new growth, intensive cultivation and tea
processing; increasing total tea area of province to 11,458 ha, 10800
ha of which give tea products.
5. Production trend
Vietnam is in the process of planning again system of tea processing.
Government encourages tea processing units, and encourages all economic
sectors to invest and modernize their units in direction of increasing proportion
of refined tea products, applying new technologies of other countries.
Incapable enterprises are not allowed to process tea.
Beside processing tea, Vietnam tea sector is trying to invest and produce
safety tea according to safety food standards, simultaneously changing the
tea growing area into ecological tourism, and creating tea ceremony bars,
etc
Moreover, in order to provide clean material source to meet the domestic and
foreign demand, many provinces have planned to expand area for producing
tea and apply new method of harvesting.
It is estimated that for the phase of 2010-2015, tea area shall be replaced at
stable rate at about 140,000 ha, average capacity of 9-10 tons of buds per ha,
and total yield of 1.2 1.4 million ton of fresh buds, equivalent to 240,000280,000 tons of finished tea.
(Jessamine, ), black tea, special tea, medicinal tea, .. Suitable for the market
demand, facing the wave of foreign tea occupation.
Recently, domestic tea consumption is increasing. The present demand for
people nationwide covers about 30% total tea yield in the country, with
average increase rate of 3 to 5%. Many domestic tea trade names are loved
by people, such as Oolong Thuan Co., Ltd, Tam Chau Tea and Coffee
Company, Lam Dong, Tri am Tea of Hoang Binh Co., Ltd, Thai Nguyen and
Oolong tea of Cau Tre export and processing enterprise. In 2005, tea
consumption amount at home is 35,000 ton.
3. Consumption trend
In general, safety tea shall beloved very much ( ISO - 9001: 2000 v HACCP ).
Famous tea in domestic market and for export shall be very popular
nationwide, especially at Lunar New Year, including:
Fresh tea material inclusive of mature and young tea, small and large,
green and not processed
Oolonh tea was formerly grown in Chian. It has shining yellow water,
strong taste and special flavor.
4. Price
Tea under trade names is often sold at high price: bud tea of VND 150 250
thousand per kg, first-class tea VND 70 - 80 thousand per kg, a kg of dried tea
of 70,000 to 75,000 VND /kg, San Tuyet tea at VND 5.000 /kg for fresh and
VND 70.000 per kg for dried. At highland district such as Hoang Su Phi price
pf selling materials id from VND 2.400 to 2.000 per kg or A green tea from
VND 35.000 to VND 40.000 per kg. In early 2007, tea price was kept stable
thank to well control. Green tea of dried buds are often sold at price doubling
other black tea of the same class. , retail price is often at VND 14.000
16.000 /kg for dried bud tea and VND 28.000 32.000 /kg for dried bud green
tea. Fresh bud tea is popular at VND 2.000 3.000 /kg.Tea price in the
middle of crop often increases to 30-50% compared with the same time last
year.
10
25/1
9/2
10/3
21/3
1/4
12/4
5/5
24/5
7/6
22/6
15/7
15/8
26/8
30/9
5. Distribution channel
Tea materials consumed at home is distributed by tea producers, wholesale
and retail agents, especially system of selling tea in bags.
11
Black tea
Green tea
Jassmine tea
Jassmine tea
Fermented tea
Oolong tea
Yellow tea
Lotus tea
In 2006
Quantity (ton)
65.274
27.003
3.776
970
287
228
190
21
Value (USD)
61.748.108
32.837.517
3.866.452
1.388.949
314.006
845.286
189.348
37.716
Types
Sep. 2007
Aug. 2007
Qty Value(U Qty Value
(ton) SD)
(%) (%)
Market
-7,95
9,27
*
24,49
40,62
68,93
152,7
7
62,47
(Source: Vinanet)
In October/2007, tea export of the whole country reaches 10,8 thousands tons
with value USD 14,29 millions, a rise 6,46% in quantity and 5,6% in value in
comparison with Deptember/2007; rise 6% in quantity and 29,9% in value on
comparison with October/ 2006. Total tea volume exported in 10 months of
2007 reaches 91,6 thousands tons with value of USD 101,16 millions, a rise
6,9% in quantity and 12,21% in value in comparison with corresponding of
preceding year.
13
101.152
1.000.000 USD
100
95
92
90.149
90
88
85
80
10 months 2007
11 months 2006
Source:
Icard
Export tea volume in months (Unit: tons)
14
2. Export market
Before 1991, Vietnam mainly exported tea to Soviet Union and Eastern
Europe. Export volume in the 80s reached 12.000 - 14.000 primarily treated
tons per year. Import countries reprocessed and packaged tea before buying
in the market. After Soviet Union disintegrated, export market of Vietnam was
expanded. Until the beginning of 2004, Vietnam exported tea to 59 countries
in the world, in which 80% of tea volume was exported to Iraq, Taiwan, India,
Pakistan and Russia. While Iraq, Pakistan and India mainly bought black tea,
Taiwan and Pakistan bought green tea (Accenture 2000). Iraq and Taiwan
take 50% of exported volume of Vietnam.
Recently, Vietnam has tried its best to expand and diversified tea export
market. Until 2007, Vietnam tea has been exported to 107 markets in the
world, in which 68 markets belong to member nations of World Trade
Organization (WTO). Big export markets of Vietnam are Taiwan, Russia,
German, China, Pakistan, Indonesia, Poland, UAE, England and Holland.
Major export markets of Vietnam in December, 2006
Name of country
December, 2006
Volume
Unit price
(tons)
(USD)
305
237.857
310
300.413
211
314.799
1.808
1.108.362
Poland
Finland
UAE
Taiwan
Federal Republic of
409
Germany
Holland
240
Indonesia
784
Iraq
Malaysia
306
US
325
Russian Federation
1.412
Japan
35
Philippines
65
Singapore
42
Turkey
91
China
610
Ukraine
144
12 months, 2006
Volume
Unit price
(tons)
(USD)
11.074
8.203.748
2.664
2.356.080
1.106
1.429.490
18.459
19.454.279
529.674
3.445
3.996.993
279.756
491.898
2.231
2.467
3.312
2.419
2.087
10.364
435
508
931
1.260
7.622
673
2.499.876
1.697.287
4.525.779
1.181.938
1.584.995
10.142.726
1.084.457
1.426.814
1.232.392
1.690.906
7.615.725
603.230
209.784
246.866
1.373.693
56.076
186.472
54.075
126.376
632.487
124.075
15
Besides, in October, 2007 Vietnam also exported 662 tons of primarily treated
dry tea with the value of 490.131 USD to China and Taiwan.
The following is information about some main export markets of Vietnam:
Taiwan market: Taiwan annually imports tea with relative big volume from
countries and the region. Taiwan not only consumpes tea in the country but
also imports for processing and exporting to other countries. According to
statistic figures of Taiwan Customs Head Office in 2003, Taiwan imported
USD 18,385,467, a rise in comparison with the previous year 8,229%; In 2004,
imported USD 19,889,492, a rise in comparison with the previous year
8,181%; in 2005 imported USD 22,815,832 more than the previous year of
14,713%. Export tea volume of Vietnam always stands at the top of this
market. In 2004, Vietnam exports tea to Taiwan market about USD
12,373,334 which keeps 62,210% tea export turnover of the whole year of
Taiwan. In 2005, Vietnam exports tea to Taiwan market about USD
13,968,121, a rise in comparison with 2004 is 12,889%, keeping 61,221% tea
export turnover of the whole year of Taiwan. Beginning three months of 2006,
Vietnam was still the biggest tea export market of Taiwan, Vietnam exported
tea to Taiwan which reached USD 3,132,756, a rise 1,009% in comparison
with the corresponding period of preceding year, keeping 73,873% tea export
turnover of beginning three months of Taiwan. In term of product category,
Taiwan market strongly consumpes oolong tea with high quality of Vietnam. In
term of price, in 2004 Taiwan imported tea of Vietnam under average price of
USD 0,770/kgm; in 2005, average price is USD 0,866/kgm and beginning
three months of 2006 with average price of USD 1,009/kgm, export tea price,
in which Tainwan imports from Vietnam is usually lower than countries and
the area.
Russia market: Tea is the only imported goods which Russia government
inserts into list of estential goods. Annually, Russian consumes approximately
1,5 billions USD from tea, on average 1,1kg tea /person/year, about 3,5 tea
cup /person/day. Russia is the third market in the world after India and
England; however, due to unsuitable climate, ability of Russias tea selfproduction is very low; the majority is exported. Main tea export markets of
Russia are India, Sri Lanka, China, Indonesia and Vietnam.
Before the 1990s, Vietnam exported 13.000-15.000 tons/year into Russia.
After a long time, tea volume of Vietnam exported to Russia is only about
1.000 tons/year; in 2001, it rised 800 tons, in2002 over 3.600 tons. In
January/2007, tea volume exported to Russia rached approximately 1100
tons, value was over USD 1 million, a decrease 24,2% quantity and 22%
value in comparison with December/2006, a rise 73% and 63% value in
comparison with the corresponding period of preceding year 2006. In 2006,
Russia is the second tea import market of Vietnam about export turnover.
Until October/2007, Russia market keeps 11,6% in total export volume of
Vietnam.
China market: China is the cradle of tea industry known as tea brand name
(danh tra), which is famous in the world and in vocational training relating to
16
tea. Although China has firm tea industry, its consumption is strongly
increasing annually. So, China still has to import a relative big volume, in
which Vietnam is the familiar partner. In 2006, China is the fourth tea import
country of Vietnam. In June, at the beginning of 2007, tea volume imported by
China keeps 14% in total output of Vietnams export tea, after Taiwan.
US market: American, the eighth country in the world about tea consumption
with 84% is black tea, the remain is green tea and other kinds of tea. However,
tea belongs to a group of goods which is difficult to import to this country and
it is strictly inspected by US Pharmaceutical and Food Management Office.
American is the potential market for Vietnams tea. Vietnams tea output
exported to this country reaches high growth rate, keeping 7,1% in total output
of exported tea, a rise 5% in comparison with 2006. The current advantage of
Vietnam is that price of green tea exported to US is much lower than that of
other countries. However, Vietnamese exporters must highly concern on
quality of tea exported to US because this market is prissy particularly in
problem of food safety.
EU market: In EU, German is the country importing the greatest tea volume
of Vietnam, but Vietnam only exports about 2-3 thousands tons in total
amount of 21 thousands tons per year. This market now tends to reduce
exported tea volume because recently, German has sent back Vietnam some
tea kinds plus requirements for re-check because quality is not guaranteed.
Other markets such as England, Poland, French, etc also reduce a
remarkable export volume.
Tea export volume of Vietnam in beginning eight months of 2007
in some EU countries
Countries
Volume (Tons)
Russia
Poland
German
7.260
2.270
1.226
7.444
2.102
1.412
England
Holland
French
941
1.104
67
1.085
1.230
172
4. Major exporters
In 2006, enterprises have great tea export turnover of Vietnam including Hong
Tra Tourism and Trade Company, The He Moi Company Limited, Tea Head
Company, Casa Company Limited and Dong Thanh Company.
Reference of output and export turnover of some tea enterprises in
September/2007
17
In comparison
with August
2007
September/2007
Name of export enterprises
Volume
(tons)
The H Moi Company Limited, Vinh
Phuc
Tin Dat Tea Export-Import Joint Stock
Company
Tan Phong Joint Stock Company
Brach of Lam Dong Company, Ho Chi
Minh city
Phu Ben Tea Company
Finlay Company Limited, Vietnam
Sai Gon Tea Company
Kien and Kien Company Limited
Nghe An Tea Development
Investment Company
Hong Tra Tourism and Trade Company
Vietnam Tea Head Company
Rong Vang Tea Joint Stock Company
Ha long Trade Factory
Thang Long Tea Trade Production
Company Limited
Branch of Swiss Singapore Overseas
Enterprises Pte. Co., Ltd in Viet Nam
Minh Anh Company Limited
Tan Trao Tea Company
Dai Loi Trade Company Limited
Thai Hoa Tea Company Limited
Phu Ben Tea 1 TV Company Limited
Huong Tra Trade Company
Bach Thuan Company Limited
Thai Nguyen Export-Import Joint-Stock
Company
Nam San Joint Stock
My Lam Tea
Cuoc song moi Company Limited
YI JIIN Tea Processing and Export
Enterprise
Hai ang Service Trade Production
18
Unit
Price
(USD)
Volume
(%)
Value
(%)
631
869.538 -35,85
-14,74
503
326.950 *
444
667.359 163,65
168,80
443
383.053 20,83
17,57
398
305
282
275
504.326
463.919
346.281
272.066
-26,81
58,49
10,54
36,00
273
327.312 8,33
8,56
241
232
228
216
391.158
287.101
177.013
171.589
4,17
-58,39
-4,69
254,45
12,14
-64,18
21,54
245,16
208
275.644 -50,85
-52,68
199
392.522 130,53
334,74
192
181
178
158
152
137
132
285.255
284.590
280.534
145.685
202.858
186.443
206.446
27,93
79,29
75,31
-63,20
*
19,41
-23,73
62,76
85,75
91,37
-70,66
*
9,82
-21,02
126
155.728 -24,10
-35,90
125
113
111
147.395 -39,02
168.249 167,53
192.941 -4,11
-9,00
161,36
-3,72
109
90.204
-24,06
-26,43
106
12.672
112,00
114,64
-24,57
43,53
1,08
61,15
Company Limited
TDK Trade Integration Company
Limited
Hiep Khanh Company Limited
Hoai Trung Tea Company Limited
ong Thanh Joint Stock Company, Ha
Noi
Dai Loc Company Limited
Xuan Viet Trade Company Limited
Song Lo Tea Company, Tuyen Quang
International Marketing and Trade
Company Limited
Ha Tinh Tea Joint Stock Company
Hiep Thanh Company Limited
Phuong Nam Food - Agricultural
Product Export Company Limited
Ha Noi Trade Head Company
Thanh Ha Export-Import Production
Joint Stock Company
Khanh Hoa Company Limited
104
196.572 -14,75
-0,83
99
97
158.567 148,44
147.659 56,13
154,45
103,04
96
150.060 57,95
112,16
95
95
89
123.818 13,10
152.600 -5,94
116.798 -36,59
24,91
53,09
-45,24
87
106.283 14,47
14,41
83
82
133.693 102,44
130.684 -50,40
131,36
-50,46
81
108.306 4,76
0,51
80
134.167 100,00
87,27
79
121.491 29,55
34,35
77
147.442 -36,91
-21,75
19
20
V. Import situation
Characteristics of Vietnam tea production industry mainly services for export
targets, therefore, tea import volume into Vietnam is very few. Majority of local
consumption is mainly handmade tea kinds without clear trade name and
almost all is to directly retail to consumers, the remain is local kinds of tea with
familiar brand names of Vietnam such as Kim Anh, Thai Nguyen tea etc
One more factor which makes tea volume imported Vietnam few is that taste
of local tea consumption is not high.
21
Fresh tea increases 2,4 times equivalent to 150.000 tons of tea shoot.
Export increases 3 times which reaches 110.000 tons until 2010 with
total value USD 210 millions.
22
Currently, countries which import Vietnam tea are trying to apply technical
barriers to protect consumers and public health. Therefore, it requires high
quality of exported tea. In 2015, Global Food Standard (ISO 2015) will be
issued. Vietnam manufacturers must concern on this thing to avoid danger of
losing export market because of non-execution of laws of some enterprises.
Ministry of Agricultural and Rural Development has given regulations of
production management, processing and safe tea certificate (No 43/2007/QDBNN, dated 16/5/2007); organizations, individuals participating in production,
processing tea in Vietnam must sufficiently implement regulations of
production conditions, safe tea processing and certificate; Next, the Ministry
has had the program of tea industry modernization with investment
expenditure over VND 420 billions which is focused for tea industry and
construction of tea processing models with high quality. Doctor Tran Van Gia
highly evaluates this policy and he proposes regions to implement this way.
(source: Vinanet).
Apart from this, activities of local production are relatively cng kh active with
plans of tea production expansion at many regions; development of tea brand
name and seeking a market for tea products are also strengthened. Moreover,
development of tera brand name and output for tea products now is not only
role of Tea Association in private but also target of regions. It needs to have
combination between the government, regions and privately-own companies
etc. This is a right guideline policy.
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