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Vietnamese tea growers hurt by heavy reliance on Taiwan

Vietnamese tea growers hurt by heavy reliance on Taiwan

Wednesday, November 04, 2015, 18:10 GMT+7

Tea growers in the Central Highlands province of Lam Dong are heavily reliant on the Taiwanese market, and such an act of putting all of one's eggs in one basket is obviously risky.

In October alone, nearly 5,000 metric tons of tea had to be returned after Lam Dong exporters failed to pass a technical barrier to ship them to Taiwan.

The provincial administration held a meeting on Tuesday to seek solutions for assisting tea growers.

“We rely too much on the Taiwanese market, so we are left perplexed when that door is closed,” Pham Duc Nguyen, director of tea firm Phuong Nam Co., said at the meeting.

A Toan, deputy secretary of the Taiwanese Business Association in Lam Dong, said local tea exporters are capable of entering a market as strict as the EU, but the technical barrier set by Taiwan is unreasonable.

In July, Taiwan began requesting that the residue of fipronil, a common insecticide, in tea exports from Lam Dong should not exceed 0.002 ppm (parts-per-million), far higher than the 0.0005 ppm limit set by the EU market.

Such a technical barrier has plagued the business of a number of tea growers and exporters in Lam Dong, Toan said.

Nine Lam Dong tea firms have had to temporarily shut down since the Taiwanese side put the fipronil residue cap in place, while other companies have had to cut production and some tea-growing areas have been left unharvested.

Reducing the reliance on the Taiwanese market may be a solution, but Nguyen, of the Phuong Nam Co., said it is not a simple task.

“As much as 90 percent of the machinery used in the tea processing sector in Lam Dong is imported from Taiwan,” he said.

“Seeking new markets also means switching to new technology and machines, something not all tea firms can afford.”

The Lam Dong administration has since decided to ban tea growers from using fipronil in their crops, starting next year.

“All of the fipronil-related insecticide products are prohibited for sale from early 2016,” the province’s deputy chairman Pham S underlined.

Local tea businesses have also been asked to build their own ‘material areas’ to ensure the quality of the raw material in processing, instead of “buying from dubious sources” as is the case currently, S added.

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