The average export price of tea in the whole country in August 2022 is estimated at 1,781 USD/tonne, up 56% compared to August 2021. However, the average export price of Vietnam’s tea is still only two-thirds of the average price of 2,500 USD/tonne in the world…
Tea exports grew in both price and value but were still lower than global prices. (Photo: Internet)
According to statistics from the General Department of Customs, in August 2022, tea exports reached 12 thousand tonnes, worth 21 million USD, down 4% in volume, but up 0.8% in value compared to July 2022; up 16% in volume and 22.6% in value compared to the same period last year.
THE AVERAGE TEA EXPORT PRICE GOT MORE THAN 1,700 USD
Generally, in the first 8 months of 2022, the whole country exported 78 thousand tonnes of tea, worth 135 million USD, down 2.2% in volume, but up 1.6% in value over the same period in 2021.
“The average export price of tea in August 2022 is estimated at 1,781 USD/tonne, up 56% compared to August 2021. Generally in the first 8 months of 2022, the average export price of tea is estimated at 1,727.8 USD/tonne, up 3.8% over the same period in 2021”.
According to the data of the General Department of Customs.
The social distancing due to the disease outbreak in August 2021 disrupted the production and export activities of many industries, including tea. This leads to the volume and value of tea exports in August 2021 being at the lowest level compared to the average of many years. Therefore, the export volume and value of tea in August 2022 increased sharply over August 2021; compared to July 2022, the figures decreased slightly in volume but increased in value due to price increases.
In the structure of tea exports in the first 7 months of 2022, green tea and black tea are the two main export categories, accounting for 89% of the total export volume. While green tea recorded growth in both volume and value, black tea dropped sharply, only reaching 28,000 tonnes, worth 41.2 million USD, down 15.3% in volume and 12.6% in value over the same period in 2021.
Notably, the export of oolong tea in the first 7 months of 2022 only accounts for a small proportion of the total amount of tea exports. However, the volume and value increased very strongly, reaching 338 tonnes, worth 11 million USD, up 69. 7% in volume and 162.9% in value over the same period in 2021. The average export price of oolong tea reached 3,016.4 USD/tonne, up 54.9% over the same period in 2021. Oolong exports to Taiwan and China account for 97% of total oolong tea exports.
In the first 7 months of 2022, Pakistan is the main export market of Vietnam’s tea, reaching 26.2 thousand tonnes, worth 49.6 million USD, up 21.9% in volume and 17.9% in value compared to the same period in 2021. Notably, tea exports to the US, Malaysia, and Saudi Arabia increased strongly. Exports to Saudi Arabia had the highest growth with an increase of 60%, followed by Malaysia with an increase of 28%.
The strong growth speed in tea exports to these markets shows that Vietnam’s tea has met the demanding needs of consumers. Opportunities for Vietnamese tea exporters are huge as these markets are all major global tea import markets.
Limitations keep tea prices low. (Photo: Internet)
RESTRUCTURE TEA PRODUCTS MORE REASONABLE
According to information from worldstopexports.com, in 2021, the US is the second-largest tea import market in the world after Pakistan, reaching 531.8 million USD, accounting for 8.1% of the total import value of the world. The authorities forecast that the demand for tea will continue to increase in 2022-2023, creating opportunities for Vietnam’s tea sector. Research by the American Tea Association shows that due to inflation, consumers have turned to tea more, instead of expensive drinks.
Although there is great potential, according to the Ministry of Agriculture and Rural Development, currently, tea materials supplied to processing factories are mainly from low-quality tea varieties. Up to 70% of Vietnam’s tea varieties are only suitable for processing black tea while the proportion of varieties for processing green tea and other teas accounts for only 30%.
“Currently, there are 370 organizations and enterprises in the country participating in tea exports to 74 countries and territories, but mainly raw products with low value. Meanwhile, the organization of tea production among provinces has a big difference, in some places a hectare of tea is worth from 500 to 800 million VND/year, but in some other places, it has not reached 100 million VND/ha/year.”
According to the MARD
Due to an unreasonable variety structure, black tea is still the main product in Vietnam’s tea exports with 55% of output, green tea accounted for 44%, and other teas only accounted for 1%. Meanwhile, in the world, the structure of black tea varieties accounts for only about 10%; varieties that can process both black and green tea account for 44.2%; varieties specializing in green tea processing account for 21.2%; and varieties for processing oolong tea and other high-grade teas account for nearly 25%.
In addition, there are many shortcomings in the processing and consumption of tea. The number of enterprises investing in high-quality tea to meet the market’s requirements is still low.
Facing the above limitations, Mrs. Do Thi Bich Thuy, an expert from the Institute for Strategic Research on Industry and Trade Policy, said that: To increase the selling price and export value of tea, it is necessary to focus on improving productivity and quality through the conversion of old tea varieties to new ones. In addition, it is also necessary to restructure the ratio of black tea and green tea appropriately to ensure meeting both domestic and international markets. Trade promotion should be supported to boost the tea and deeply processed tea products to high-income markets such as Japan, Taiwan, Korea, the EU, and the US.