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Each day TFO Canada publishes a sample of trade news on the Canadian import market along with any new, updated or changed regulations and legislations regarding international trade; countries in which TFO Canada offers services and on the export sectors which it promotes.

 

Vietnam's pepper industry adds spice to economy

Thursday, March 10, 2016 > 10:03:44
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(Nikkei Asian Review)

Pham Duy Quang made a life-changing decision 15 years ago after growing cashew nuts and coffee since the mid-1970s on two hectares of farmland in the rolling countryside 80km north of Ho Chi Minh City.

It was then that the former South Vietnamese soldier tore out his coffee and cashew plants, and replanted the fields with pepper. He believed peppercorns would prove to be a more lucrative crop and would make the four-year wait for his first harvest worthwhile.

"It was not an easy start. When we started growing pepper, the Vietnamese government did not have any support program for these agricultural products. Sometimes, our pepper crops were lost due to fake fertilizer and pesticides, disease and bad weather. We had to find our own way and learn from experience after years of growing them," said Pham, who is 63.

Despite the years of trial, error and disappointment, it turned out that Pham made the right decision. Nine neighbors soon joined him and the village eventually attracted the attention of traders and buyers in Vietnam's booming pepper industry as the country became the world's top pepper exporter, displacing traditional pepper producers Indonesia and India, which mostly grow their crop for domestic consumption.

Describing the tireless and often innovative efforts of thousands of small pepper farmers across the country, Nguyen Mai Oanh, vice chairman and secretary general of the Vietnam Pepper Association, said "farmers have tried to earn income to escape poverty. They have learned and apply new technologies day by day."

Success in numbers

To increase their productivity and to lighten the workload, Pham and his neighbors agreed to cooperate instead of competing against each other. They pooled money to build a small power station to pump water for their crops, replacing the generators each farmer had operated separately on their own plots. The farmers also financed the construction of a small road crossing their farmlands that linked the village to a nearby main road, enabling pepper buyers to visit more easily.

Vietnam's pepper exports amounted to about 133,000 tons in 2015. The Vietnam Pepper Association predicts that production could increase by a further 10% in 2016.

Measured by weight, this amounts to only a tenth of Vietnam's coffee production. Vietnam is the world's second biggest coffee exporter after Brazil.

But the export price of Vietnam's coffee is now around $1,400 a ton, much less than pepper, which has ranged from $7,500 to $9,500 per ton over the past two years.


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