AN OVERVIEW OF THE COCOA SECTOR IN VIETNAM

FOREST SCIENCE SUB-INSTITUTE OF VIET NAM - WWF VIETNAM

This project is supported by The Dutch Directorate –General for Development Cooperation (DGIS), WWF and the International Food and Agricultural Trade Policy

Council (IPC)

Market Trends

    During 1990s, world cocoa production increased 1 to 2 % per year (3.16 m.t. in 2004/5) Reduction of volume in several big producers: Cote d’Ivoire, Ghana Malaysia and Indonesia.

Several of the world largest cocoa importers are heavily dependent on cocoa products from West-Africa and Indonesia Looking for new markets

   Increase of consumption at double the production rate Demands for cocoa increasing 2-4% p.a, especially in Asia and pacific regions (China’s 5%) Largest processing and grinding countries: Netherlands, the US, Germany, Brazil and the UK

Conditions for Cocoa

•Cocoa grows well from 20 o N to 20 o S.The natural habitat of the cocoa tree is evergreen rainforests Temperature Annual rainfall Humidity Water logging Dry season pH 18-21 0 C (min), 30-32 0 C (max.) 1,500-2,000mm 100% (night time);70-80% (daytime).

Sensitive Not exceed 3 months with less than 100mm rainfall.

5.0-7.5



Many hectares of land around Mekong Delta and Central highlands satisfy these requirements

Current Cocoa Planting Areas in Vietnam

Provinces

Ben Tre Ba Ria-Vung Tau Dac Lak Binh Phuoc Tien Giang Dong Nai Binh Dinh Lam Dong

Areas (ha)

1,500.0

450.0

1,083.5

268.0

300.0

50.0

100.0

1.0

 

Government Plans for Cocoa Production

  By 2010 produce 20,000ha in four regions which cover 28 provinces (currently 4,000ha) -Ben Tre has planned to invest a budget of VND 24 billion to grow cocoa on 10,000 ha. -The Dak Lak coffee company has switched 500 ha of coffee to cocoa.

Cocoa crop development will not repeat the mistakes with coffee (high quality cocoa)

1 0 0 0 0 9 0 0 0 8 0 0 0 7 0 0 0 6 0 0 0 5 0 0 0 4 0 0 0 3 0 0 0 2 0 0 0 1 0 0 0 0

Progress in Cocoa Production in Vietnam

1 9 9 7 1 9 9 8 1 9 9 9 2 0 0 0 2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 ( p r o j) 2 0 0 6 ( p r o j)

  There is a potential for becoming a well-known exporter for high quality cocoa beans Smallholder production offers more potential than extensive or monoculture plantations

  Many international groups involved   Donors (e.g. DGIS, GTZ, USAid, USDA) Companies (e.g. Cargill, Masterfoods, ED&F Man) Cocoa coordination committee established (16 members)

An Initial Assessment of Cocoa in Five Provinces

   Survey method: “Rapid Rural Appraisal (RRA)” Locations: Binh Phuoc, Dak Lak, Dong Nai, Binh Dinh and Lam Dong Research raises a number of issues:

   Firstly, the slow progress on the development of certified cocoa varieties in Vietnam. Secondly, limitation in knowledge and experience on cocoa crops by both farmers and extension workers Thirdly, occurrence of diseases and insect pests

 Fourthly, require a viable market so that farmers can sell their products  Fifthly, improved planning for the development of the cocoa sector, both nationally and provincially

Recommendations

   Promote the early completion of a set of certified cocoa varieties and quality standards for cocoa beans in Vietnam Establish more nurseries to provide high quality seedlings to growers Extensions workers and cocoa farmers provided with high quality training programs on cultivation practices, post harvest treatment, crop maintenance and insect pest control measures

 Establish a viable market system to provide farmers with greater security that they can sell their produce  Systematic research on the environmental impacts of different production techniques and species mixes, as well as biological mechanisms to control pests and disease outbreak  Greater government support for the establishment of post-harvesting facilities in Vietnam

   Develop more coordinated and clear government planning on cocoa production (central and provincial levels) Assess impacts of tariff escalation on the value-added cocoa industry in Vietnam Involvement of multi stakeholders in the development of the cocoa sector in Vietnam (Gov, Donors, NGO). Co ordinating Committee for Cocoa Development

Next steps

 Phase II will build on recommendations from phase I  Work closely with Cocoa Coordinating Committee

To receive this document please contact: Pham Minh Thao at WWF Vietnam ([email protected])