Report Feasibility study organic bitter tea Cao Bang - Helvetas

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SUMMARY Feasibility Study Organic Bitter Tea in Cao Bang: 2007 Bitter tea (Ilex kaushue) is an evergreen tree species that grows in the natural forests in Cao Bang. Because of its potential as a healthy and unique beverage, the Cao Bang provincial authorities started a bitter tea plantation project program and set up the Cao Bang Bitter Tea Company (BTC) for bitter tea processing and marketing. In 2006, the Cao Bang bitter tea market chain was assessed using the Rapid Market Appraisal approach (RMA) as part of a project supported by Helvetas. 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. An external consultant specialised in organic agriculture and certification and one Helvetas staff conducted the study. The study included a document review and a field trip to Cao Bang (November 6-10, 2007). The results of this study should then be used by the decision makers to decide if it would be worth to start a certified organic production for specifically identified markets. Technically there do not seem to be any obstacles for organic bitter tea production. However, a number of measures have to be taken to conform to the organic standards. Although there is no immediate demand for organic bitter tea (since the Korean buyer is more interested in "low chemical" than organic) it would be useful to consider conversion to organic at an early stage. Since some chemical inputs are being used in the current bitter tea production, a conversion period of two years has to be considered before the product can be sold as organic. Organic bitter tea should be seen as part of the diversification process of the BTC so that a larger variety of clients can be reached. It would therefore not be recommended to convert the entire production of the BTC to organic. It would be easiest (and most simple to manage) if for example a certain area will be converted completely and a processing unit set up there which is dedicated to the organic products. Since the processing of bitter tea is relatively simple and no expensive machinery is being used, the investment for this second processing unit would be rather low. A good area for organic production would, for example, be The Duc commune of Nguyen Binh district. In terms of certification it would be easiest to select one certification body that could provide all necessary certificates through one inspection visit. To further reduce costs a certifier with local or regional inspectors should be chosen. To eliminate the need for an inspection visit to all organic producers (and thereby greatly reducing the certification costs), a group certification system should be set up. This would require an Internal Control System (ICS), which, if managed by the BTC, would have the added advantage of providing a good tool for managing the organic supply chain and the training of farmers. Furthermore, the responsible staff of the BTC should develop a good understanding of concepts related to food safety and certification requirements. This would include organic production and certification but also GAP, HACCP, etc. Secondly, the existing overseas contacts, particularly from Korea and Japan, should be approached to find out what their requirements are in terms of adherence to specific standards. To develop a market for organic bitter tea it is essential to develop some organic production. This will allow potential clients to check the product and its specifications. vi
Feasibility Study Organic Bitter Tea in Cao Bang: 2007 Having some organic production (with an ICS) already will also speed up the process of certification since the conversion period could be reduced at least for the pilot area. As mentioned in section 4.6, it would be interesting to also explore the possibilities of creating some new products on the basis of (organic) bitter tea. In many markets organic products are successfully introduced as new products and not just to replace a traditional product. This could really attract new customers who would otherwise not take bitter tea in its original form. vii
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Report Feasibility study organic bitter tea Cao Bang - Helvetas

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