Brian Jeffrey
Surging Prices of Areca Nuts
Areca nut prices in Vietnam have hit their highest point in eight years. Initially, farmers in Quang Nam and Quang Ngai sold fresh areca nuts for VND40,000 per kilogram, but prices later skyrocketed to VND80,000-90,000.
The cost of dried areca nuts has also seen a substantial increase, reaching between VND500,000 and VND570,000 per kilogram.
Experts attribute this price surge to a strong demand from Chinese buyers who are actively purchasing areca nuts from Vietnam. Farmers have benefited significantly; selling just one ton of areca can yield enough funds for a tael of gold. To safeguard their crops from theft, many farmers have invested in surveillance cameras for their fields.
Additionally, merchants have been rapidly gathering fresh areca from farming communities in Quang Nam and Quang Ngai to export to China, where areca is primarily used in candy production.
Price Decline and Market Dynamics
This decrease in prices results from Chinese buyers having fulfilled their collection needs, and further declines are anticipated.
Nguyen Nhu Cuong, director at the Ministry of Agriculture and Rural Development’s crop production department, explained that fluctuations in prices are common for Vietnamese agricultural exports to China.
During the same period last year, fresh areca nuts were priced much lower, at VND5,000-7,000 per kilogram.
Cuong highlighted that the areca market is quite limited and that the majority of areca exports to China occur through unofficial routes.
In late 2022, areca prices did spike to VND60,000 per kilogram but subsequently dropped to as low as VND3,000-4,000 after Chinese purchases ceased.
Warnings About Oversupply
Authorities from MARD and local officials have repeatedly cautioned about the risks of oversupply if farmers grow the same crop in large volumes. Despite these warnings, price volatility remains a constant feature, affecting not just areca but other agricultural products as well.
Analysts suggest that Vietnamese farmers should heed past experiences from crops like pepper, dragon fruit, and oranges, with similar challenges possibly arising with durian in the future.
Ultimately, while MARD and specialists can offer guidance, it is the farmers who ultimately choose their crops. Market prices are dictated by supply and demand, limiting the ability of governmental bodies to intervene effectively.
