Weak market demand coupled with stricter regulations remain the main barriers to the Vietnamese tea processing industry when it tries to gain a strong foothold in foreign markets.

Vietnam exported 121,000 tonnes of tea for US$211 million in 2023, decreasing by 16.9% in volume and 10.9% in value, respectively, compared to 2022. These figures mark the lowest levels seen over the past seven years.

The price of exported tea in 2023 averaged US$1,737.3 per tonne, up by 7.3% year on year, but it was only equal to 67% of the average world export price of tea which reached US$2,600 per tonne last year.

The country’s main tea importers include Russia, Pakistan, and Taiwan (China), all of which showed decreases in turnover in 2023.

According to the Ministry of Agriculture and Rural Development (MARD), Vietnamese tea has failed to satisfy the preferences of international consumers, therefore lower demand might have played a part in the fall of tea exports.

Furthermore, most of the tea exported is in the raw form, low in quality and value. With little investment into improving the quality of the tea, local processors failed to meet stricter regulations set by foreign markets.

The MARD has recommended that in order to increase tea export value, businesses strengthen cooperation, develop high-quality raw material areas, and change to new varieties while improving processing steps, and ensuring food safety requirements in order to meet market demand.

The whole country has 120,000 hectares of land under tea cultivation, and 257 tea processing enterprises with a total designed capacity of 5,200 tonnes of fresh buds per day. However, only a few among them have invested in modern processing technology.

VOV