Vietnamese tea undervalued by lack of innovation: national association chairman

Tea growers in Vietnam primarily concentrate on meeting immediate production and sales agreements; and not enough of “polishing or innovating,” which undervalues Vietnamese tea, says Hoang Vinh Long, chairman of the Vietnam Tea Association.

Long was speaking Tuesday at a forum on “Connecting production and consumption of high-quality tea” held in the northern province of Phu Tho.

“We’re doing very well in domestic consumption. In provinces like Thai Nguyen, Ha Giang and Son La, there are types of tea that sell for as little as $7 per kilogram, while other varieties can fetch more than $20 per kg,” Long said.

Many small, fragmented factories were trapped in a cycle of low prices due to years of stagnation and a lack of innovation, he reiterated.

The agricultural sector itself was fragmented into small-scale production with insufficient emphasis on agro-industry, leading producers to focus on low-cost tea buds.

Long emphasized the need for stronger collaboration between businesses, cooperatives, farmers and local authorities to improve the situation.

He urged all stakeholders to work together to exploit the full potential of the sector and move away from the mindset of “undervaluing prices” and market fragmentation.

Nguyen Ngoc Thach, editor-in-chief of Nong nghiep Viet Nam (Vietnam Agriculture) newspaper, noted at the forum that Vietnam was the fifth largest tea exporter in the world with products sold to more than 100 countries and territories.

However, the average export price of Vietnamese tea was only about 65% of the global average and just 55% of the average price of tea exported from India and Sri Lanka.

Thach said the main reason for the low export price was that most of Vietnam’s tea exports are raw and minimally processed with simple packaging and no branding.

Nguyen Quoc Manh, deputy director of the Department of Cultivation under the Ministry of Agriculture and Rural Development, added that in 2022, Vietnam produced a total of 194,000 tons of tea, of which 146,000 tons were exported, generating $237 million in revenue. Domestic consumption accounted for just 48,000 tons worth $325 million.

Manh also acknowledged that while Vietnam processed about 15 different types of tea, including black and green tea, the value of Vietnamese tea products was still relatively low, only 70-75% of the value of similar products on the global market.

A representative from the Department of Crop Production emphasized the importance of developing safe tea-growing areas, using appropriate tea varieties, setting quality standards, and planning tea processing factories to add value.

The representative also suggested linking specialty tea areas with the OCOP (one commune, one product) program and exploring opportunities to develop tea tourism.