During Covid-19, agriculture becomes pillar of the economy

The Covid-19 pandemic continues to cause exports to stagnate. Coffee growers in the Central Highlands are experiencing many hardships.

The coffee price has dropped dramatically. On March 28, it fell from the VND30,000 per kilogram threshold to around VND29,700-29,800 per kilogram, lower than the production cost of VND32,000-33,000 per kilogram.

As the price decreases, farmers have restricted sales, resulting in short supply for export.

The General Department of Customs (GDC) reported that Vietnam exported 154,396 tons, worth $260.975 million in March and 473,785 tons in the first three months of the year, worth $801.62million, a decrease of 53.4 percent in quantity and 9.42 percent in value compared with the same period last year.

Coffee price falls to 15-year low

The coffee price increased for three consecutive trading sessions early last week and stayed at VND30,000 per kilogram. But it later fell from the threshold. The opening price on March 28 decreased by VND1,000 per kilogram to VND29,700-29,800 per kilogram because of the London Robusta coffee price drop.

Robusta coffee prices were VND30,600 per kilogram in Bao Loc and VND29,500 in Di Linh district in Lam Dong province. In Dak Lak province, the prices were between VND29,700 and VND30,000 per kilogram. In HCM City, R1 was priced at VND31,300 per kilogram.

Covid-19 is raging in Europe and US, while restaurants and hotels in Italy, Spain, France and the UK have closed. They are all the key export markets for Vietnam’s farm produce, including coffee.

Do Ha Nam, deputy chair of the Vietnam Coffee and Cocoa Association (Vicofa) and chair of Intimex Group, confirmed that all the export shipments to Europe have been cancelled, forcing the prices down.

Vietnam is controlling the epidemic very well but exports won't resume if the COVID-19 exists in export markets.

“Rice remains the only farm produce item which still can prosper in the context of epidemic,” Nam commented.

As the coffee price has fallen to the 15-year low, farmers have choppef down coffee plants and are growing other crops instead.

Preparing for post-Covid-19

Analysts believe that though the exports have decreased, the risk for farm produce is still lower than other production fields. The demand would soar again once the epidemic is contained.

Therefore, according to Nam, exporters need to prepare well for the post-Covid-19 period. “By that time, the demand will soar again and the prices will bounce back,” he said.

However, the problem now is that enterprises lack money to store goods while waiting for prices to increase again. Meanwhile, they need money to cover expenses to maintain operation and pay bank debts.