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VIETNAM TRADE PROMOTION AGENCY

EXPORT PROMOTION CENTRE

======

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

3
3
3

II. Production situation


1. Distribution of production location
2. Feratures, classification and product structure
3. Scale and capacity of production
4. Source of production materials
5. Production trend
6. Domestic and foreign famous trade names

4
4
4
5
7
8
8

III. Domestic consumption


1. Market features
2. Situation of domestic consumption
3. Consumption trend
4. Price
5. Distribution channel

9
9
9
10
10
11

IV. Export situation


1. Yield and turnover of export
Types
In 2006
2. Export market
4. Major exporters
5. Opportunities and strengths of export

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12
12
12
15
17
19

V. Import situation

21

VI. Orientation and policies of developing tea export of Vietnam

22

VII. Useful addresses

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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

2. General information of the sector


Vietnam is not only famous as the home of rice but also known as one of the
most ancient cradle of tea. Vietnamese people have planted tea for over three
thousands years and nowadays, drinking tea has become a traditional habit of
each family. Belongs to the South East of Asia, Vietnam has many natural
advantages to cultivate and process tea, such as tropical climate, soil,...
Therefore, the quality of Vietnam tea products is higher than other areas,
especially some traditional specialty like Shan Tuyet, Suoi Giang,... According
to a historian, these teas were only discovered in the Northern mountainous
region of Vietnam. Most of them are long-standing trees with 6-8 meters of
height. Tea plantations in Vietnam are concentrated in the north and middle,
spread over some provinces like Tuyen Quang,Yen Bai, Phu Tho, Son La, Ha
Giang, Lai Chau, Lao Cai, Thai Nguyen, Nghe An. Beside being one of the
solutions to eliminating hunger and reducing poverty, tea plantations also help
protect the environment and bring high income to the growers. Consequently,
tea has become a high value product of Vietnam.
In recent years, the area of tea cultivation and the number of manufacturers
have increased rapidly. Particularly, from 5,400 hectares in 1975, the area of
cultivation has reached to 125000 hectares in 2007. The raw output was
about 40,000 tons in 1995, now stands at approximately 577,000 tons, of
which export quantity rising from 17,500 tons to 105,000 tons. Labor
productivity in tea has risen annually by 4% during the last ten years.
Up to now, Vietnam tea products have made their presence in more than 107
countries world-wide. In 2000, about 1,500 tons of processed tea was
exported to Russia, allowing Vietnam to rank sixth among the fifteen Asian
countries exporting tea to that market. The Western European market,
especially Britain, annually imported 2,000 tons of tea. At present, Vietnam is
known as a high quality green tea exporter with potential clients like Pakistan,
Taiwan, China, RussiaF In Asia, Taiwan and China are the biggest importers
of Vietnam tea. Newly emerging markets like America, France and Australia
also have high demands for Vietnam tea which need about 5,000-7,000 tons
a year.

II. Production situation


1. Distribution of production location
Vietnam is known as the worlds cradle of tea. Almost nowhere in the world
but Vietnam is given a favor, by nature, to be permissive to grow tea
spreading in the whole country.
There are often two types of soil for growing tea in the North and the Central
Vietnam. They are terra empelitis of stone and clay, and rich basalt. Hence,
tea is grown namely in the central and mountainous provinces, or in three
main regions: region lower than 300 m high, midland at 300 - 600 m high,
highland (mountainous region) at 600 - 1.000 m high and higher.

Mountainous region includes provinces of Ha Giang, Tuyen Quang,


Lao Cai, and Son La. Tea variety grown in this region is called Shan (or
named as snow tea) with high yield and good quality. In the Northern
mountainous region is first place of developing tea on the largest area
nationwide. Total regional area of tea in 2005 is around 90,800ha,
covering 80.7% of the national tea area. Of which, Thai Nguyen is the
tea largest area with 16,400 ha (18.1%).

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.

2. Feratures, classification and product structure


Vietnam tea is verified; beside traditional tea varieties, an amount of additional
40 new ones with high quality, good taste and aromatic flavor have been
imported. Vietnam has processed 15 types of commercial tea. There are 6
types of tea for export, of which black tea, Jessamine tea and oolong tea are
loved in many countries. Major types of Vietnam tea are as follows:
4

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.

Japanese green tea: produced by an automatic production line of


Japan. Product is featured with green water, natural flavor. It is
consumed at home and in Asian market.

Beside above-mentioned teas, Vietnam also has other types including


flavor tea, fresh flower tea, slender black tea, soluble tea, long leave
tea, medicinal tea, bud tea, brown tea, etc.

3. Scale and capacity of production


Vietnam started production tea over 3000 years ago. After occupying the
Indochina, the French colonialist brought tea trees in the end of 19th century.
In 1885, France took the first survey on tea plantation in Vietnam and the first
tea plantation was set up in the early 1890 in Tinh Cuong, Phu Tho (Zeiss and
Den Braber, 2001). By 1938, area of growing tea was 13,405 ha, yield was
6,100 tons of dried tea. In the struggle for independence, most of tea
plantations were left wild and thus the tea market was collapsed. By 1946,
yield of tea was only 300 tons. After 1954, tea production was much
developed. In 1958, area for growing tea was 30,000 ha and Vietnam had two
tea processing factories located in Hanoi and Phu Tho with total capacity of
1,100 ton per annum. In 1977, tea area was expanded to 44,330 ha with yield
of 18,000 ton dried tea, since the implementation of reform work, tea has
been considered as a key goods, tea production has been more and more
developed. By 2000, tea yield reached 35,000 tons with more than 600
enterprises and 10,000 peasants involved as household staffs.
Vietnam yield of tea increased remarkably in the 1990s although it was for
expanding tea area than growing capacity. During the phase of 1990 2003,
tea field increased at rate of 7% per annum on average whilst area and

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

(Source: CIEM, 2007)


Vietnam has a quite great tea gene bank with nearly 150 strains. During a
recent time of investment and cooperation with foreign countries, Vietnam has
created 50 new varieties, then studied and collected 8 new varieties
permissible for spreading in provinces and cities nationwide, contributing to
the increase of tea yield and capacity.
At present, there are about 250 tea processing industrial units with capacity of
about 70,000 tons per annum. Private tea production and processing units
developed quickly, increasing at 3 times in term of amount and 2 times in term
of capacity in comparison with those in 2000. Vietnam produces orthodox
black tea (60%), CTC black tea (7%) and green tea (33%).
Safety tea production is carried out in many places such as Thai Nguyen, Yen
Bai, Moc Chau (Son La) by limiting the use of chemicals, strictly complying
with principles once using herbicides.

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.

4. Source of production materials


Vietnam finished tea types are mostly produced from domestic source of
materials. To better meet the source of tea materials, Vietnam tea sector has
planned to expand region of producing tea in many localities, as follows:

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.

Together Ha Tay, Nghe An province is also building a tea specializing


area in Anh Son district for the purpose of poverty alleviation. Currently,
Anh Son has totally 3.000 ha in 2010; the locality tries its best to grow
250-300 new ha of tea. To make this target come true, Anh Son district
carries out policy of supporting peasants in term of variety investment.

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.

6. Domestic and foreign famous trade names


Vietnam has many key tea regions with fame of high quality such as Lam
Dong, Lanf Son, Son La, Lao Cai, Cao Bang, etc At present, there are more
than 2.000 Vietnamese famous trade names such as bat Tien, Kim Tuyen,
Thuy Ngoc, Keo Am Tich, etc However, recently Vietnamese tea is known by
the importer and exporter via signal of three-leave tea which is transactionnamed as VINATEA
With utmost on the way of integration of Vietnam tea sector, Logo "CheViet" is
now registered according to Madrid Agreement with 73 countries and under
current advertisement. Vietnam Association of Tea allows 6 domestic
enterprises to label i "CheViet" on wrapping of 17 products for domestic
consumption and export.

III. Domestic consumption


1. Market features
Drinking tea has been a longterm habit of Vietrnamese, and that becomes a
fine traditional custom. Most of Vietnamese households use tea to treat their
guests or just for their and their familys demand. On average, a person
consumes 0,2kg/month and 2,4kg tea per annum. With 85 million of
population nationwide, domestic consumption demand is very great.
Finished tea products though have not really met the taste of domestic
consumers, they are accepted by most of them. They often buy tea in kg and
manually produced. Others use tea according to their favorite taste, trade
name and flavor. In general, state of the domestic consumers is not very high
and they are not hard to choose their suitable tea type. In the future when tea
drinking becomes an art, Vietnamese consumers shall be much stricter.

2. Situation of domestic consumption


Most of tea consumed at home is green tea with 90% yield of green tea. In
come rural area, habit of drinking green tea is more popular; however, most of
tea sold out are primarily processed.
Black tea is only consumed in big cities, but only covering 1% total
consumption level . But it is increasing in the urban, with a flavored tea
introduced by Dilmah, company of Sri Lanka. It is estimated that Lipton and
Dilmah take about 70% market shares in big cities and industrial areas. Other
products processed from tea such as soft drink, candy, biscuit are not plenty
in Vietnam.
Tea grown in the Northern provinces like Thai Nguyen, Son La, Ha Giang and
Yen Bai is quite popular in Hanoi and other northern big cities. While tea
produce in Lam Dong are popular in HCMC and Southern provinces. Green
tea with jasmine, lotus and other flower flavors are also popular, covering 20%
domestic consumption.
Although tea drinking habit has a long history; according to estmation of FAO,
average tea consumption per Vietnamese capita in 1997 was only 260g,
much lower than other Asian countries (Hong Kong 1400g; Taiwan 1300g;
Japan 1050g; China 340g). However, from 2000 to 2005, average tea
consumption per capita of Vietnam was 5% to 380g.
Tea exported namely in form of raw or primarily process tea, and sold on the
domestic market. Vietnam has many famous tea production areas like Thai
Nguyen, Moc Chau and Kim Anh. Vietnamese consumers are often sensitive
in tea quality.
In the age of door open, domestic tea market becomes eventful, various in
types, labels and wrappings, espcially developing tea in bag and flowered tea
9

(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

Bud tea: young tea harvested and exposed to the shadow

Brown tea in Ha Giang is traditional tea in the Northern mountainous


area, processing with two to three young leaves.

Oolonh tea was formerly grown in Chian. It has shining yellow water,
strong taste and special flavor.

Many other tea types

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

Tea price in Lam Dong province


From January 4th to September 30th, 2007 (VND/kg)
3050
3000
2950
2900
2850
2800
2750
2700
2650
2600
2550
4/1

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

(Source: Information Center PT NNNT)

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

IV. Export situation


1. Yield and turnover of export
In 2005, Vietnam becomes the 7th greatest tea exporting country of the world
with export amount of 80.000 ton. In 2006, Vietnam tea export reached more
than 105 thousand ton, export turnover of 111,6 million USD. Yield increased
by 20% and added value of 14% compared to that of 2005. At present,
Vietnam process about 15 types of different tea types and exports 6 types of
tea to the world, mostly oolong tea, black tea and jasmine tea.
Only Ha Tay province produces more than 5.000 ton black tea to USA, India,
Middle East, increasing nearly 800 ton; Tuyen Quang has Cong Lo Tea
Company exports more than 718 ton, covering 84,4% of plan compared with
that at the same time in 2005.
Export tea types in 2006
Types

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

(Source: General Department of Custom)


National tea export in September 2007 reached 10.161 ton value 13,53
million USD, reducing 8,53% in term of quantity and 3% in term of price in
August 2007; reducing 10% in term of quantity but increasing 10,27% in term
of price compared with September 2006. Total amount of export tea in
September 2007 reached 80.813 ton with value 86,87 million USD, increasing
7% in term of quantity and increasing 9,96% in term of value compared with
that in 2006.
In term of type structure of export tea in September 2007, black and green tea
was still main export tea of Vietnam. Specifically, in September amount of
export black tea was 5.224 ton with value of 6,4 million USD, reducing
18,75% in term of quantity and reducing 7,95% in term o price; green tea
reached 4.090 ton with value of 186 million USD, increasing 1,32% in term of
quantity and increasing 9,27% in term of price compared with that in August
2007.
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Types of export tea in September 2007

Types

Sep. 2007
Aug. 2007
Qty Value(U Qty Value
(ton) SD)
(%) (%)

Market

Russia, China, Arab Saudi, Taiwan, ,


Pakistan, Poland, Turkey, USA,
Malaysia, Indonesia, UK, Sri Lanka,
5.22 6.403.46 Black tea Ukraine, Lebanon, Holland, India,
4
1
18,75
Finland Japan, Iran, Denmark,
Latvia, Iraq, Italy, Canada, Israel,
Belgium
Pakistan, Afghanistan, China,
Taiwan, Indonesia, Arab Saudi,
India, Germany, Singapore, Russia,
4.09 6.186.41
Green tea Poland, Holland, Japan, Iran,
1,32
0
5
Philippines, Finland, Ukraine, South
Africa, Sri Lanka, Latvia, republic of
Czech
Dried tea China, Taiwan
662 490.131
*
Jasmine
Taiwan, Indonesia
353 448.464
tea
42,43
Other
Taiwan, Pakistan, China, Mexico,
142 225.354
types
Cambodia, Canada
37,84
Fermented
Taiwan
51 68.880
35,77
tea
333,0
Yellow tea China, Hong Kong, Taiwan
22 32.547
0
Oolong tea Taiwan
14 48.825
61,25

-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

Situation of tea export in 10 months of 2007


105
1000 Tons

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)

Tea export turnover in months (Unit: millions USD)

(Source: Trade information)


In 2007, Volume of export tea is estimated to reach 112 thousands tons with
value of USD 130 millions, a rise 6,03% in quantity and 17,72% in value in
comparison with corresponding of preceding year 2006; a rise 1,82% in
quantity and 8,33% in value in comparison with plan of the whole year of 2007.
Estimated in the period 2010-2015, export tea volume of Vietnam will reach
about 200.000 tons with structure of 50% black tea, 20% of new tea product is
has high value and 30% of high qualitative green tea reaches approximately
USD 300 millions

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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

(Source: Customs Head Office)


In October, 2007, the main market of Vietnams black tea consumption is
Russia (967 tons), China (961 tons), Arab Saudi (711 tons) and Taiwan (449
tons). Pakistan is the main market for Vietnams green tea consumption with
2.253 tons (gains 55% of exported green tea volume in September, 2007).

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)

Price (thousands USD)

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

(Source: Customs Head Office)

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

(Source: Vietnam trade information)

5. Opportunities and strengths of export


After Vietnam has entered World Trade Organization (WTO), ability of market
expansion of tea industry has many advantages.
Before situation of reducing market share in EU, Vietnam Tea Industry is
expanding market to some Asia and Middle East countries. These are
countries with great export demands but requirement is not too high, mainly
kinds of tea with average quality like China.
In 2007, area of new multiplication and high productivity, good quality
reaches 32,5% in total area. Tea gene hospital, in the country and local import
has about 150 kinds. Only in short time, because of investment expansion,
cooperation with other countries, Vietnam has imported over 50 new genders,
in which 8 new genders are allowed for multiplication in development projects
in provinces, cities in order to advance tea productivity and quality. Besides,
Vietnam has long coast which is suitable for goods transport by waterway to
other countries.
Specially, tea price of Vietnam only is equal to 70% in comparison with the
same tea price of other countries so that this is favorable competitive factor in
international market.

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Vietnamese government has right development strategy, and Vietnam tea


industry has many prospects and being one of important exchange source for
national economic, plus coffee, rice, rubber,cocoa, cotton and pepper.

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.

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VI. Orientation and policies of developing tea export of


Vietnam
Tea is one of strategic exported agricultural products. Decree No 43/1999
QD-TTG dated March/1999 on approving program of developing tea industry
in the period 2005-2010. It sets up 4 targets for tea industry from now to 2010
as follow:

Productivity increases 1,7 times in the country

Output increases from approximately 60.000 tons to 214.000 tons

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.

Creating more jobs for approximately one million people.


Apart from this, in 9 provinces belonging to concentrated development
policies of the government, there are 5 provinces of black tea production
(Tuyen Quang, Yen Bai, Phu Tho, Son La, Nghe An) and 4 provinces of green
tea production (Ha Giang, Lai Chau, Lao Cai and Thai Nguyen).
Ministry of Agricultural and Rural Development has given 5 main solutions to
develop tea industry in next time, including: implementing planning and tea
development; promoting technological science and technical transfer in tea
production and processing; strengthening international cooperation, trade
promotion; expanding market of tea consumption; encouraging all economic
factors to develop industrial bases and tea processing ones according to
planning, and gradually modernizing these bases according to direction which
makes rate of refined tea products, guaranteeing enough capacity to process
with high quality and product diversification; finally, it needs to reorganize
production of tea industry.
Ministry of Agricultural and Rural Development appoints VinaTea and
Agricultural Design & Planning Institute to construct planning of production
development and tea processing on the scope of the country next years;
optimal suitable area must be identified for each region, province. Besides,
guiding provinces to plan concentrated tea areas in combination with
processing industrial establishments, creating qualitative material resource for
plants.
Tea Research Institute needs to study and select suitable gene for each
ecological area plus high productivity and quality; researching advance about
growing skill, balanced fertilization, synthetic prevention, limit of chemical use,
humidity, process of harvest.
Development of tea production in following years must be reorganized
according to direction: households produce bud tea, enterprises focus on
processing industry and consumption. The government needs to create
favorable conditions and aid for highland farmers in order for tea intensive
farming and manufacture; encouraging households which have capital, labors,
experiences and confidence towards tea industry to expand scale of tea farms.

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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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VII. Useful addresses


Information about Vietnam agricultural product
http://www.agroviet.gov.vn
Ministry of Agricultural and Rural Development
http://www.moi.gov.vn/News/Main.asp
Vietnam Tea Asociation
http://hiephoichevietnam.org/

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