Export local turmeric into Indian market

​

 Mr. Le Van Tien (in the middle), Director of Hoang Dung company is conversing with the staff of Bank for Agriculture and Rural Development of Xuan Loc district.

* Harsh startup
We met Mr. Tien at the processing facility at the time when the business was busy with orders at the end of the season. Dressed as simply as a typical peasant, but the way he conversed was very impressive. Perhaps, 38 years serving as the head of Gia Lao hamlet has helped him have such a confident attitude. When asked about his 10 hectares of pepper being harvested, a company with a charter capital of over VND30 billion creating regular jobs for dozens of local workers, Mr. Tien replied with a modest smile: “Me? I’m just a paid farmer for 25 years! ".
Then he said, he was born in Bien Hoa city, after the liberation, he followed his family to start their business in Suoi Cao. With only 2 acres (2,000m2) of land for growing cashew nuts, the members of the family had to work as hired laborers, from weeding to picking up cashew nuts and pepper in vast lands of cultivation. Just by working while saving money, in 1982 Mr. Tien (19 years old then) bought himself a tractor. At that time, tractors were not easy to find while the demand was high. In order to meet the needs of farmers, Mr. Tien did not mind providing plowing service days and nights. When the peak season was over, he took his time providing agricultural product transportation or crop fertilization services to earn more. His business began to go up, a tractor could not meet the high demands, Mr. Tien made a bank loan to buy another machine, then two more and hire additional laborers. "Earnings from plowing service were also good. However, it is impossible to become rich when farming without arable land. That thought prompted me to buy land, " Mr. Tien shared. After marriage, in 1987, Tien bought 3 acres of land for growing fruit trees. He earned more to buy more, his land area gradually increased to 3 hectares, 5 hectares, and then 10 hectares.
In the early 2000s, in addition to maintaining plowing, transporting agricultural products and weeding services, Tien began to do his own business. Thanks to the relationships with farmers and traders in the area, his business has many advantages. He started to collect products of all crops such as corns, cassavas and cashew nuts from local farmers. With not so much capital, Mr. Tien chose to buy fresh agricultural products and then resell them to traders to make profits. His trading business ran smoothly, in 2005, Mr. Tien established Hoang Dung agricultural products limited company. Two years later, he stopped providing plowing service and concentrated on buying agricultural products.
In 2008, with his real estate, Mr. Tien decided to make mortgage loan from the bank, switching 10 hectares of cashew and complex trees to pepper. Determined to establish a new specialized farming area for table productivity and easy management so to begin Mr. Tien spent 5 billion to build a tank and solid piles. "Thinking that back then I had such a risky decision. For three years, the profit from agricultural product trading was poured into the pepper garden, "Tien said. At the time of seedlings, fearing that crop diseases could cause a complete loss of both capital and land, Mr. Tien spent most of his time in the garden observing every little development process of pepper trees. At the same time, he himself studied more documents related to pepper disease prevention. Thanks to careful fertilization, pepper trees grew quickly and started to bear fruits for the first time after 3 years. Up to now, his pepper garden has been nine years old. This crop alone, he expects to collect about 17 tons of pepper.
For a long time, the local residents in Gia Lao hamlet have admired the talent and the assertion of the prestigious hamlet lead who has the strong determination to begin his startup. From having no land for cultivation, he became a director of a large business. It can be said that, the entrepreneurship of Mr. Tien has become a motive for many young farmers to follow.
The potential of turmeric export
"Unlike many other crops, this long rainy season results in very high productivity of turmeric (40-45 tons / ha on average, about 10 tons / ha higher than last year), which leads to high productivity of turmeric starches. Thanks to that, the profit per ton of turmeric this year is twice as high as that in previous years. Unfortunately, the number of orders is not as high as expected," Mr. Tien regrets. This crop season, Hoang Dung Company is expected to purchase 1,000 tons of fresh turmeric, but so far only bought 700 tons. The reason is due to many off-season rains leading to long drying time, and many traders compete fiercely in collecting turmeric due to high demand in turmeric export.
According to Mr. Tien, since 2007, through the information of agricultural products he knew the export potential of turmeric. Through his partners, Mr. Tien became acquainted with a farm export business based in Ho Chi Minh City. Getting the agreement to become an intermediate export unit from the enterprise, Mr. Tien began his journey to search for raw materials and to study preliminary treatment experience. For the past two years, the demand for domestic turmeric consumption and export has increased. Mr. Tien has expanded the purchasing area of raw materials to 3 provinces including Dong Nai, Ba Ria - Vung Tau and Binh Thuan and had to "turn" one hectare of pepper harvested into a drying yard.
Up to now, Mr. Tien's company has exported 300 tons of dried turmeric, and it is expected to export 100 tons more by the end of this year, doubling that of last year. From 2017 to 2018, Mr. Tien plans to export 500 - 600 tons of dried turmeric. "This is just the number that the company can deal with, and the actual demand for foreign customers is always higher," Tien said.
Mr. Tien said, in the world, India is the leading turmeric consumption and export market. However, many Indian processing facilities are importing raw materials from Vietnamese enterprises including Hoang Dung company. Then he explained: "Vietnamese turmeric contains more essential oil and Curcumin (A kind of precious essence used in producing medicine) than Indian turmeric, about 30kg fresh turmeric extract 1kg of this kind of essence on average, of which the higher level of purity of this substance is, the higher the price is. Moreover, the taste, the color of Vietnamese turmeric is also better which is favored by foreign markets. I see, the export potential of Vietnamese turmeric is real”.
The successful 2016 - 2017 crop season has created favorable conditions for raw turmeric exports, both farmers and businesses enjoy the benefit. However, in order to improve the economic value of turmeric export and also to keep export markets stable,  Mr. Tien said he would seek partners and invest in technologies to process turmeric and curcumin with the trademark Made in Vietnam for export rather than just processing raw turmeric for export.
From the beginning of the harvest season, the market price of fresh turmeric has increased steadily, from VND 5,500 / kg to VND 6,200, VND 2,000 / kg higher than that in 2015. The price of dried turmeric for export has increased by VND 5,000 / kg. Now the price dried unpeeled turmeric for export is 43,500 VND / kg, that of dried peeled turmeric is 49,000 VND / kg. There are two kinds of turmeric for exports available, turmeric with preliminary treatment and turmeric starch. India, Japan, Korea, Canada, United Kingdom ... are the countries that are importing Vietnamese turmeric. Raw turmeric is used as the main material to produce turmeric powder, spices, cosmetics and pharmaceuticals.