Vietnamese Cocoa: Need to invest in branding.
In the context of rising world prices, cocoa is opening up opportunities, but also posing requirements for sustainable development and branding.
Cocoa, a crop once considered a "new wind" in Vietnam's agricultural sector, has gone through many challenges and changes on the way to affirm its position.
World prices increase sharply, opportunities for Vietnamese cocoa
As a country that owns the famous Trinitario cocoa variety, Vietnam has great potential to make its mark on the global market. Trinitario accounts for only about 15% of the world's total cocoa output but is highly appreciated for its unique flavor and superior quality. The recognition by the International Cocoa Organization (ICCO) of Vietnamese cocoa as one of the varieties with premium flavor is the "passport" that opens the door to exports to demanding markets.
Trong Duc Company owns more than 1,000 hectares of cocoa raw material areas nationwide
However, unlike other crops such as coffee or pepper, cocoa trees grow steadily and do not bring immediate profits. This industry requires patience and method from farmers, businesses and managers.
The sharp increase in world cocoa prices in 2023, reaching VND 12,500/kg, double the average of many previous years, has attracted great attention from stakeholders. However, experienced people in the industry, such as Mr. Dang Tuong Khanh - Director of Trong Duc Cocoa Company Limited, still emphasize that expanding cocoa growing areas must be based on a long-term strategy instead of following temporary market prices.
Pressure from climate change and supply chain
The rapid increase in cocoa prices in recent times has largely come from a decline in global supply. In West Africa, which supplies more than 70% of the world’s cocoa, prolonged drought, pests and political problems have caused production to decline significantly. Meanwhile, demand for chocolate and cocoa products has continued to increase, especially in Europe, where cocoa is not only a food but also a cultural symbol.
In addition, climate change is putting additional pressure on the global cocoa industry. Drought, rising temperatures and poor soil conditions are forcing many producers to change their farming methods or seek more resilient cocoa varieties.
Vietnam, with its tropical climate and geographical diversity, is emerging as a potential alternative for international importers.
Promoting deep processing and brand building
A weakness of the Vietnamese cocoa industry today is focusing too much on raw exports instead of investing in deep processing. Although some businesses such as Marou and Grand Place Puratos have made their mark with high-quality chocolate products, most Vietnamese cocoa beans are still exported as raw materials with low added value.
According to international experts, Vietnam needs to increase research and development (R&D) to create innovative products from cocoa. so co la, cocoa powder, cocoa butter... are all high-value-added products that are in great demand in the world market. In addition, building a national brand for the cocoa industry - similar to what countries such as Ghana, Belgium or Switzerland have done - will help improve the image of Vietnamese cocoa and attract more international partners.
Some new cocoa growing areas, such as the Central Highlands and Central Coast, are being expanded with the expectation of minimizing the risk of being concentrated in a single geographical area. At the same time, businesses and farmers are gradually shifting to more sustainable production methods, focusing not only on short-term profits but also on protecting the environment and developing long-term livelihoods.