Coffee exporters to face new rules

October 24, 2011 | 17:20

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The Ministry of Industry and Trade (MoIT) is compiling a draft decree to deal with problems relating to the management of coffee exports.

The decree would require exporters to meet specific conditions such as having legal trading certification, exporting at least 5,000 tonnes of coffee a year for two consecutive years, having standard processing and warehousing facilities to store at least 5,000 tonnes of coffee, and meeting financial transparency standards.

At present, it is estimated that only 40 enterprises in the country would meet requirements set by the draft decree and be allowed to export coffee.

According to the Vietnam Coffee and Cocoa Association (Vicofa), more than 150 enterprises are involved in coffee exports at present.

These enterprises competed with each other in buying and selling coffee, negatively impacting the country's credibility as well as coffee quality, Vicofa said.

The Ministry of Agriculture and Rural Development (MARD) has agreed with the MoIT on the need for new rules on coffee trading and export, saying they are an imperative in the current situation.

Vietnam exported 1.2 million tonnes of coffee worth $2.6 billion in the 2010-11 crop, up 8 per cent in volume and 47 per cent in value over the 2009-10 crop, Vicofa said.

The association estimates coffee output for the 2011-12 season at about 18-18.5 million 60-kg bags (1.08-1.1 million tonnes), accounting for 15 per cent of the global output.

The country expects to export more than 1.1 million tonnes of coffee next year.

Based on enterprises' export capacity and capital demand, the MARD has asked commercial banks to set aside between VND16 trillion ($763.5 million) and VND20 trillion ($954.4 million) to help them purchase the beans produced in the 2011-12 harvest.