Lao coffee can compete in AEC markets
Lao coffee can compete in AEC markets
Coffee production in Laos is not in a weak position if compared to coffee products from other countries and challenges can become opportunities as Laos seeks to compete in AEC markets, according to coffee association members.
The President of the Lao Coffee Association Mr Sinouk Sisombath spoke recently at a meeting, noting that domestic consumption of Lao coffee is not as big as that of foreign drinkers when making regional comparisons.
“Asean will have more than 600 million people, meanwhile Laos has only just over 6 million people but we are quite confident to compete with other Asean countries,” he said, adding that the Lao coffee sector was not in a weak situation by any means.
A recent meeting on Asean Economic Community (AEC) preparations was co-chaired by Deputy Prime Minister Mr Thongloun Sisoulith, aiming to seek appropriate solutions to challenges and problems that various business sectors are facing, especially in preparation for the coming AEC.
“If we mention coffee processing in Laos, there is a large coffee processing factory while small-d farmers can also produce high quality coffee beans as well,” Mr Sinouk said at the meeting.
He added that more buyers from neighbouring countries are interested in importing Lao coffee, especially buyers in Vietnam. They import both the green coffee beans and roasted coffees and processed coffees as well.
In the region, Laos produces 30,000 tonnes of coffee beans per year, while Vietnam is a major player and produces some 1.5 million tonnes of coffee annually by comparison. Thailand also produces some 60,000 tonnes every year.
Both the Arabica and Robusta strains of coffee are grown in Laos, which is cultivated on large areas of the southern provinces of Champassak, Saravan and Xekong. Arabica was initially introduced in Laos in the 1920s while Robusta was introduced after World War II.
According to a recent report, the coffee plantation area in Laos currently covers around 80,000 hectares, mostly in the southern provinces.
Total production is around 30,000 tonnes, while the value of exports is around US$70 million.
In the fiscal year 2011-2012, the country exported a total 20,000 tonnes of coffee beans, worth US$66 million.
In 2012-2013, production increased to more than 27,000 tonnes worth US$67 million while in the first six months of this year the country has exported 21,800 tonnes, valued at US$47 million, indicating a further upward trend.
This commercial crop has created permanent jobs for about 20,000 families and also generated indirect jobs for some 300,000 people in the plantation areas.
To help the coffee business operations, Mr Sinouk also called for the government and the state-owned and commercial banks to provide appropriate loans to the coffee entrepreneurs, making it easier for them to upgrade production facilities.
“When it comes to improvements to the legal system to support the coffe e sector, the government will play a key role in this matter,” he explained.
Mr Sinouk also revealed that the first Lao coffee festival will be held in Champassak province from October 24-26, aiming to promote Lao coffee products to supply both domestic and export markets.
In the first few months of this year, the government agreed to approve the strategic development plans for the Lao coffee sector with a focus on the promotion of local products, according to a senior government official.
vientiane times
