Vietnamese Coffee Production Drops 20% After Record Year

HANOI - May 30/02 - SNS -- Coffee production for 2000/2001 in Vietnam was the highest its ever been, but last year saw production drop 20% to 735,000 metric tons (MT).

Yields for 2000/2001 were 920,000 MT, but because of a reduction in crop area and yield last year's figures were substantially lower. The area reduction occurred mainly in key robusta producing areas like the Tay Nguyen (Central Highlands) provinces, where some low yielding coffee trees were chopped down. Yields dropped due to drought and low input use (less investment in irrigation, pruning, and fertilization). Many Central Highland areas have suffered from a prolonged drought from December 2001 until May 2002.

In Dac Lac province, home of more than 60% of Vietnam coffee, the crop yield was estimated to decline by 15% and the 2001/2002 crop area decreased by 7,000-8,000 hectares. During a recent visit to the province, the USDA saw some coffee areas being replaced by cashew trees inter-cropped with cassava plants. Cotton and corn are also considered (by the regional government officials) as good crops to replace coffee.

According to local people, coffee production may be even worse in the 2002/03 coffee crop as coffee has been impacted by drought and abandoned for three consecutive years. The province authorities are trying to encourage farmers to cut an additional 70,000 hectares of coffee trees by 2005. However, the process is slow as many farmers want to keep their coffee trees - hoping that prices will eventually improve. The provincial government strictly bans planting new robusta coffee trees by measures like land use certificates and bank loan policies.

According to coffee observers, 2002/2003 coffee production will decline even further as coffee trees are exhausted because of low input use and less irrigation. Current estimates place Vietnam's coffee area in the 2002/2003 crop down to 520,000 hectares, with production at 630,000 MT - as the average crop yield is estimated to drop by about 12% compared with the 2001/02 crop yield.