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Progress in the Vietnamese Tea Industry

After several business trips to Vietnam, Kalyan Kumar Nanda, executive director of marketing for T & I Global Ltd., details the latest developments in the country's tea production.

Vietnam is geographically linked to the area which extends from Yunan, through Northern Cambodia and Shan, right up to Assam, known as the home of tea. Tea plantations in Vietnam are mainly */concentrated in the North and North-Central mountainous regions. The earliest available recorded data on the tea area in Vietnam is for the year 1955, and shows that there were approximately 5,400 hectares under tea at that time. This increased to approximately 39,000 hectares in 1975, and now stands at approximately 70,000 hectares. This data shows that the tea areas are fairly young and it can confidently be stated that about 50% of Vietnamís tea area is between 20-25 years of age.

Of the 70,000 hectares of land under tea, only about 52,000 hectares are for production of black and green tea. The remaining area, about 18,000 hectares, is put to other local use.

The total commercial production of black and green tea from those 52,000 hectares is about 50 million kilograms. Of this, almost 50% (mostly green tea) is consumed in Vietnam and the balance is exported. The 'other local use' of the remaining land is for the production of tea used in the brewing of a fermented liquor with additives, and for growing tea to eat like any other green plants. One can find old branches of leaf that are up to three months old being sold in the village markets.

The average yield of commercial tea is about 1000 kg per hectare. For an area where a large percentage is of young tea, this is extremely low and provides considerable scope for an increase in total production. It would be reasonable to expect the yield to gradually increase from 1,000 kg. per hectare to 2,000 kg per hectare by improved maintenance and agricultural practices. This would double the total annual production to one hundred million kilograms.

Recent Promotion and Expansion

Long Phu Tea Factory in Vietnam

According to Kim Phong, chairman of the Vietnam Tea Association, some tea areas were lost to other crops in 1994-95 in lieu of wages, as the industry was going through very difficult times. In 1996, Vinatea ran a massive promotional drive for tea. This had phenomenal results and the industry saw a turn around for the better. The promotion helped to increase domestic consumption and tea exports in the year 1997. This boost helped to increase the price of green leaf and that, in turn, encouraged the small tea growers. The wheel of success had started to turn and momentum has been gradually building up.

The government was encouraged by the success and put tea, followed by coffee, as one of the front runners for development. The development program laid special emphasis on the following: increasing the size of tea-bearing area; improving the quality of the end product; improving the existing factories; and increasing the number of factories in order to process the projected larger volumes of leaf.

Further, in its development program, the government earmarked nine provinces and gave them priority for intensive development. Of these nine provinces, five are for black tea and four for green tea production.

The total area for black tea is about 25,000 hectares and is spread over the five provinces of Tuyen Quang, Yen Bai, Phu Tho, Son La, and Nghe An. The total area for green tea is about 12,000 hectares and is spread over the four provinces of Ha Giang, Lai Chau, Lao Cai, and Thai Nguyen.

Essentials for Further Growth

The tea processing area at Long Phu Tea Factory

The tea industry in Vietnam has excellent potential and prospects for future growth. It is poised to take off very strongly and all this is clearly visible in the great interest being shown by those in the top echelons of the Vietnam tea industry.

Mohijit Sen of International Tea Resources, Singapore, has visited Vietnam on a number of occasions on advisory assignments. He has made extensive studies of the Vietnam tea industry and as a result of discussions with him, the following could be concluded to help hasten the development program for the tea industry in Vietnam:

1) Tea growers in Vietnam need training in modern methods of tea culture and harvesting. Pruning and plucking practices need to be significantly altered. Instead of the existing practice of pruning the entire tea area annually, a pruning cycle should be resorted to. The ancient Chinese plucking method of removing only two leaves and leaving the third from the three new leaves should also be replaced by the modern plucking methods.

2) Total production can grow rapidly if important fertilizers and macro/micro nutrients are made available to a larger tea area - at present, only about 30% of the total area, which is under the organized sector, is receiving limited quantities of fertilizers.

3) Fortunately, there appears to be hardly any problem in the tea areas from pests and diseases and all effort should be made to keep this under strict control.

4) Weed control is mostly manual. Contact, systemic and mild pre-emergent weedicides, which are applied extensively with great success in other countries, should be used.

5) Tea areas are being severely affected by poor drainage/water management/soil conservation practices. It is important that this aspect is given due consideration at the earliest opportunity.

6) The existing tea factories are designed such that there is limited flexibility available during manufacture to cater for changes in weather pattern, leaf quality, and market demands.

7) Most existing factories have older Russian machines. If these machines are used, however sturdy and reliable, it will be at the sacrifice of modern developments in manufacturing practices. To cater for the increased volumes in future and the changed market requirements, new factories will need to be constructed, and existing factories will have to be upgraded with new machinery.

The industry is making progress on the above mentioned lines and is therefore well positioned to create a significant impact on the world tea market very soon. A number of tea factories have already been rehabilitated and most of these are for the production of orthodox black tea. This has resulted in improving both the quality and the quantity of made tea. In the not-too-distant future, it is expected that several other factories will be rehabilitated, and Nghe An Province has already awarded contracts to T&I Global Ltd. India to carry out turnkey jobs on two CTC tea factories. It is anticipated that this project will be completed by the end of this year.


Tea & Coffee - August/September 2000
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