Vietnam sees short coffee harvest, low output
HANOI - Vietnam, the world's second-largest coffee producer after Brazil, said on Thursday this year's harvest should peak next month and would be shorter than normal because bad weather had hurt bean production. The Vietnam Coffee and Cocoa Association, which represents coffee producers and exporters, has said output for October 2005-September 2006 would fall to between 10 million and 10.5 million 60-kg bags from 12.5 million bags the previous year, due to drought and neglect. Vietnam's coffee harvest, which started earlier this month, usually peaks beginning in mid-November and ends in January.
"The main harvest will start in November," Doan Trieu Nhan, vice chairman of the association, told Reuters. "It will peak in November and December, but the whole harvest will not last long as there is not much coffee."
Nhan said adverse weather in Vietnam, the world's biggest producer of the robusta variety widely used for making instant coffee, had contributed to the reduction in yield.
"The average yield will be less than 1.5 tonnes per hectare, compared with more than 1.5 tonnes previously," he said ahead of a meeting in Hanoi to discuss the development of Vietnam's coffee industry.
Once blamed by the world's top coffee producers for causing excess supply that pushed prices to 30-year lows in 2001, Vietnam has planned to reduce its robusta area and expand the plantation of aromatic, higher-priced arabica.
It has set a goal of 100,000 hectares of arabica, known locally as Catimor, by 2010, from 30,000 hectares now.
Robusta cutting slow
In the past three years under a government programme, Vietnamese farmers have switched part of their robusta trees to other crops such as cashew and rubber.
The plan was to have only 400,000 hectares of robusta coffee.
Official industry statistics show Vietnam cut robusta trees by around 10 percent to 450,000 hectares (1.11 million acres) in the previous crop year, which ended in September.
"The process has been further under way in various provinces, but it is up to the farmers to cut their trees," Nhan said.
Traders said shifting part of the coffee plantation had been slow, since 85 percent of Vietnam's coffee is grown by farmers, making it difficult to gather statistics, control quality and carry out major government policies.
Stefanie Miltenburg, a manager at Sara Lee Corp, told the meeting that Vietnam's coffee sector was threatened by a lack of capacity and concepts to assist the industry in carrying out training, research, trade and market information.
"Should prices stay at around 10,000 dong, nobody wants to quit 10 million dong per hectare of coffee a year to take on another crop," Nhan said.
Domestic prices firmed this week to 13,700-13,800 dong (86.3-86.9 U.S. cents) per kilogram of coffee beans from 13,100-13,500 dong last week in the central highland province of Daklak, which produces a third of Vietnam's total output.
Miltenburg, who also spoke for Nestle , Kraft Foods Inc. and German roaster Neumann Kaffee Grouppe at the meeting, urged Vietnam to ensure quality consistency in processing, storing and bean screening.
"Vietnam is very competitive in producing and delivering basic quality coffee but could improve on quality and implementation of sustainable practices," she said.
Traders said strict quality control remained essential prior to each shipment from Vietnam. ($1=15,872 dong)
Reuters - October 27, 2005.
|