Two workers at a coffee seedling garden in Dak Lak Province. Photo courtesy of DakLak Online
With limited government support, replacement of aged coffee plants is too slow. If recultivation is not accelerated, in the next 5-10 years, Vietnam will see a sharp fall in coffee output, which will hit its exports, Le Ngoc Bau, head of the Central Highlands Agriculture and Forestry Science Institute, tells Vietweek.
Most coffee trees in Vietnam were planted 20-25 years ago and need to be replaced with new ones. But the task is being done too slowly. Why?
Le Ngoc Bau: Coffee growers are not interested in replacing old trees with new ones because they still earn profits from the old trees. However, coffee prices have recently decreased to just VND30,000 (US$1.4) per kilogram from VND40,000 a year ago, and so farmers are making lower profits. It could be a driving force for them to speed up replacement of old trees with new ones for higher yields and bigger profits.
The cost of replacing old plants is not too large for coffee producers who have made profits from the export of products for the past many years. It is estimated at just VND100 million ($4,762) per hectare. So [cost] is not the main reason for the slow replacement of old trees.
The main problem is that farmers do not have enough information about the technologies required and new coffee varieties. They plant seeds and saplings with low resistance to pests, so the number of dead plants in the first one or two years after cultivation is often high.
LE NGOC BAU, Central Highlands Agriculture and Forestry Science Institute
|Most farmers regrow [coffee plants] on their own and do not use advanced technologies
How are seeds and saplings selected?
Up to 75 percent of the coffee trees now were grown from seeds selected manually. Good seeds have been developed over the past 10 years, and trees cultivated from the seeds cover 20 percent of the coffee-growing areas in the Central Highlands.
Vietnam has good coffee seeds. Trees developed from them can yield an output of 3-4 tons of coffee beans per hectare, higher than the 1.5-2 tons from old trees.
Up to 90 percent of coffee trees were grown from seeds because of the much higher cost of transplanted saplings.
Are profits from seed and sapling production high enough to attract companies?
Not many firms want to enter the field because of the fear of low sales. Profits are not high as they sell at only VND300,000 ($15) per kilogram of seeds. However, we do not have to worry about the supply of seeds. Our institute can produce 20 tons of seeds a year, enough for cultivating 20,000 hectares.
Farmers often buy seeds for cultivation from producers instead of selecting by themselves unlike 15-20 years ago. However, management of seed quality is not good. It is very easy to set up firms for trading seeds. The government should use a small part of the profits from coffee exports to develop seeds and saplings for coffee replanting. The investment is very small compared to the benefits that coffee brings to Vietnam.
Our institute can develop good seedlings. However, due to limited funds, it still uses outdated technologies resulting in high production costs. Seedling research and production at the institute will get better if it can get funding of just VND10-20 billion ($4.75-9.5 million).
How long does Vietnam need to replant coffee trees?
It is necessary to frequently replace old trees with new ones. Every coffee producer has to replant. However, it is a big issue in Vietnam as we need to replace tens of thousands of hectares of coffee trees every year. Years ago we grew coffee trees en masse on tens of thousands of hectares annually.
Does the government provide support to farmers for regrowing coffee trees?
The government has helped farmers access technology for recultivation of coffee trees. However, the support is not enough. So most farmers regrow on their own and do not use advanced technologies. The government also subsides 30 percent of the value of seeds for recultivation, but the procedures for it are too complicated. The volume of seeds that farmers buy with government subsidy is also limited.
How will the slow recultivation affect coffee exports this year and in future?
The issue is not yet too serious. However, the coffee output will fall sharply in the next 5-10 years if we do not speed up recultivation of large areas of coffee. The most important thing is the application of advanced technologies for seed and sapling production. A mere 500,000 hectares of coffee trees could yield 1.4 million tons of coffee beans a year if 70-80 percent of the trees are grown from good seeds. Now, more than 600,000 hectares of coffee trees yield 1.4 million tons. We produce the world's best coffee seedlings.
But why is our coffee not of good quality?
It is because of bad harvesting and processing. The rate of harvesting unripe coffee fruits is still high. Coffee trees developed from our seeds can yield 3-4 tons of coffee beans per hectare a year, compared to the current average output of 2.3 tons. Coffee trees in Indonesia have an output of 0.4 tons of coffee bean per hectare per year.
|According to the agricultural ministry, Vietnam has some 600,000 hectares of coffee trees that yield annual output of 1.4 million tons of coffee beans.
Old trees with low yield and poor quality account for some 25 percent of coffee cultivation area, and Vietnam needs at least VND15 trillion for the coffee tree re-cultivation, according to the ministry.
The central bank has assigned the Agriculture Bank of Vietnam to arrange loans of VND8-10 trillion with the annual interest rate of 10-10.5 percent to farmers between 2013 and 2015.
Some 140,000-160,000 hectares of old coffee trees should be replaced with new ones in the next 5-10 years, it said.
Vietnam exported nearly 1.32 million tons of coffee valued at $2.75 billion last year, according to the General Statistics Office.
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