Vietnamese tea export turnover falls

Recently, Vietnamese tea received bad news from its largest customer, Pakistan, which began to tighten the quality control of tea imported from Vietnam.

More than a decade ago, Vietnam ranked fifth in the world for tea production. Vietnamese tea products were exported to 74 countries and territories. Vietnam’s tea export turnover remained the same for years.

According to statistics, in 2009, Vietnam's tea export turnover reached 200 million USD for the first time. In 2021, tea export revenue was around 214 million USD.

Compared with other agricultural products with the same starting point, some experts said that the Vietnamese tea industry "does not grow up". 

For example, in 2009, the country's pepper export turnover reached 328 million USD. It took this product only five years to join the "billion-dollar export club" with an export revenue of 1.2 billion USD in 2014. Meanwhile, tea export turnover has been maintained at over 200 million USD/year. Even in 2021 and the first months of 2022, tea export turnover decreased sharply.

According to the Import-Export Department (Ministry of Industry and Trade), the annual value of Vietnam's tea exports averaged 173.2 million USD in the 2016-2020 period, while the global tea import value reached 7.2 billion USD. Thus, the export value of Vietnam's tea only accounts for 2.4% of the total world tea import value.

The range of tea products for export is not diverse enough, while the quality of tea is not very high, and the packaging designs and standards have not yet met the market demand, so it is difficult for Vietnamese tea to compete in the world market.

Pakistan, Taiwan and Russia are now the three major markets for Vietnamese tea. Pakistan accounts for 34.4% of the total volume and 40% of the total export turnover, followed by Taiwan, accounting for 14.7% of the total volume and 13.4% of the total turnover. Russia ranks third, accounting for 9.51% of the total volume and 9.88% of the total export turnover.

Not only that, low-value black tea is the main export product of Vietnam, accounting for 55% of output, compared to 44% for green tea, and 1% for other teas. Meanwhile, globally, the structure of black tea varieties accounts for only 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%.

Vietnam should not miss $37.5 billion market

A study by Research and Markets shows that the global tea market was at valued 24.3 billion USD in 2016 and it is expected to reach 37.5 billion USD in 2025, with a growth rate of 5% per year in the period from 2017 to 2025. The growth of the tea industry is on the rise due to changing lifestyles and increasing consumer awareness about health benefits of drinking tea.

Along with increased demand, producers have tried to offer diverse tea products to suit customer demand. Accordingly, premium-quality tea for home consumption, healthy tea, cold brew tea and other items will be the leading product lines for the market in the coming time.

According to experts, with its advantage of tea production, Vietnam can boost tea exports to take a part of the 37.5 billion USD “cake”. However, the Vietnamese tea industry needs to focus on improving productivity and quality, and strongly invest in processing to form an advanced tea processing industry in Vietnam.

In addition, it is necessary to develop a strategy to exploit thousand-year old tea forests in the country. This is a great advantage to create the image and build a high-class Vietnamese tea brand.

Tam An