Report Feasibility study organic bitter tea Cao Bang - Helvetas

Feasibility Study Organic Bitter Tea in Cao Bang: 2007
and more difficult to sell. At the time of the feasibility study the production of tea bags was
already stopped completely.
According to the RMA, bitter tea is mostly bought as a gift, with the highest demand in
winter, during holidays, festivals and in particular the Tet holiday. A small group of people
buys bitter tea for personal consumption, mainly because of its health properties.
Some of the reasons for the low sales volume include the fact that consumers are not
convinced about the health qualities of the bitter tea or even have a negative feeling about
the tea (since it has been reported that bitter tea has a negative effect on fertility and
reproductive health) 1 . For the BTC in particular, the price of their products is relatively
high while the packaging is not so attractive. However, despite the apparent health benefits,
many people are not very interested in bitter tea because the product is just too bitter and
they would prefer drinking green tea or some other beverage.
The RMA concluded that the following solutions should be prioritised in order to improve
the Cao Bang bitter tea value chain:
To mark the boundaries of growing materials according to cultural and
ecological conditions and habits of each region;
To determine the origin of the bitter tea tree's origin;
To invest in and protect existing growing areas continuously;
To (set up strategies and implement research to) diversify the product;
To change some products into functional products; and
To design the product and its packaging in accordance with the targeted clients
and in a more professional manner.
(Pham, 2006).
3.2. Feasibility study
In parallel with the RMA, Helvetas had some discussions with the BTC on activities to
improve the bitter tea production and marketing. One of the topics of the action plan
identified by the RMA is to focus on product diversification. Since some foreign
companies, mainly from Korea, have shown interest in organic bitter tea, Helvetas and the
BTC agreed to carry out a feasibility study of organic bitter tea production in Cao Bang.
Main objectives of the feasibility study:
To review the existing bitter tea value chain (inputs, production, processing,
marketing) by emphasising the most important topics in regard to the
conversion to the organic farming system;
To review the standards for organic products for some of the main markets
(Japan, Korea, and EU)
To make a cost benefit analysis to assess whether or not a conversion to the
organic standard is profitable
To analyse the changes or modification in the bitter tea value chain (inputs,
production, processing, marketing) necessary to met the standards and propose
approaches and strategies on how to do it
1 : A more recent study has, however, demonstrated that this in unfounded and there is no negative effect of bitter
tea on fertility and reproductive health. (Bui and Bui, 2006)
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