Vietnam's largest coffee trader says it lost dlrs 31 million
over three years
HANOI - Plunging world coffee bean prices have pushed Vietnam's
largest state-owned coffee producer, Vinacafe, into financial strife with losses of
487.8 billion dong (dlrs 31.5 million) over the last three years, an official said
Thursday.
The company expects further losses if the export price of beans — already
lower than it costs to produce them — continues to drop, the official said on
condition of anonymity.
The Ministry of Agriculture & Rural Development has offered extra funding and
exemption from land-use taxes. But growers in the largest coffee-producing
province, Daklak, say the industry's problems can only be solved if bean prices
rise above production costs — currently dlrs 530 to dlrs 600 per ton.
Export prices have been as low as dlrs 300 per ton, with growers receiving even
less than that, the Vietnam News newspaper reported Thursday.
A recent report by relief agency Oxfam International said world coffee prices are
at a 30-year low because 8 percent more coffee is being produced than
consumed.
It said multinational coffee companies are making large profits by charging
consumers in rich countries 1,500 percent more than farmers in poor countries
are paid for their beans.
In the past decade, Vietnam has become one of the world's largest coffee
exporters and the largest producer of low-quality robusta beans.
Rival coffee producers blame Vietnam's rapid increase for triggering the world
price fall.
Vinacafe, which has more than 26,000 workers in 59 plantations, is one of the
country's largest state-owned corporations. It has operating capital of 573.7
billion dong (dlrs 37 million), the state-controlled Tien Phong (Pioneer)
newspaper said.
Vinacafe reported losses of 55 billion dong (dlrs 3.5 million) in 1999, when
coffee prices began falling, deepening to 161.6 billion dong (dlrs 10.5 million) in
2000 and 271.2 billion dong (dlrs 17.5 million) in 2001, the newspaper said.
By the end of 2001, Vinacafe had lost almost half its capital, and amassed
debts of 2.85 trillion dong (dlrs 184 million), the report said.
The Associated Press - September 19, 2002.
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