China demand boosts cassava price

Due to demand from mainland China, traders are buying large quantities of cassava, causing the domestic price to go up 40-45 per cent compared to last year.

The export cassava price also increased during this period.

According to the Viet Nam Market Analysis and Forecast Joint-Stock Company Agro-Monitor, domestic sliced cassava is selling for VND6,300 per kilo.

The export price of tapioca starch to China has increased to US$550 per tonne.

The Plant Quarantine Sub-Department of Region VIII said 350-400 tonnes of cassava were being exported to China daily through the border gate at Lao Cai.

In October last year, Chinese traders travelled to Viet Nam to pay deposits to agents in Phu Yen, Lao Cai, Yen Bai and Lai Chau provinces to buy cassava.

The Chinese market has faced a large shortage, especially of the cassava varieties and sliced cassava.

The domestic traders have taken full advantage of the situation to collect fresh, dried and sliced cassava as well as cassava varieties to transport to Quy Nhon port in central Viet Nam for export to China.

The Phu Yen Department of Agriculture and Rural Development said in 2010-11 crop the province grew 12,500ha of cassava, with an estimated output of 200,000 tonnes.

However, the current cassava purchases are expected to cause a shortage of cassava varieties and affect production and long-term cassava cultivation.

According to the Customs General Office, Viet Nam exported 1.667 million tonnes of cassava, earning a turnover of $556 million last year.

Sliced cassava accounted for 56.8 per cent and tapioca starch 42.9 per cent.

China remained the biggest importer of Vietnamese cassava last year, accounting for 94.8 per cent of the total export turnover.

The Ministry of Agriculture and Rural Development said this year, the areas for growing cassava was about 500,000ha, with output of about 8.9 million tonnes, higher than last year’s output of 8.52 million tonnes.

According to an annual report of the cassava and tapioca starch industry and AgroMonitor’s forecast, this year’s total demand for fresh cassava for domestic production is about 8.12 million tonnes.

That includes 1.89 million tonnes for ethanol production; 2.67 million tonnes for foodstuff processing and animal feed production; and 3.56 million tonnes for tapioca starch production.

Thus, there is only 780,000 tonnes for export, equivalent to 355,000 tonnes of dried sliced cassava.

However, China has begun increasing its imports of sliced cassava and fresh cassava, which could increase Viet Nam’s exports up to 4-5 million tonnes.

As a result, the domestic tapioca starch processors and animal feed producers will face severe competition in buying raw materials.

Experts said a long-term development strategy for the industry should be created, including solutions that would balance the supply and demand for exports and raw material supply for domestic production. — VNS

Tags: cassava prices