Wednesday, March 24, 2010

Read These Leaves...

Vietnam, a land I have never been near, yet feel I have visited repeatedly through its cuisine, books and meeting or reading the stories about 1st generation immigrants to the US. As a high-plains, prairie born Midwesterner, it isn’t exactly a kinship to the delta culture that draws me to the land and people yet the bond is there; inexplicable, strong even if it lies beyond my ability to explain it. If I had to approximate what draws me to this country - part of this alliance is based on the tragedy of Vietnam - the colonial burden, the wars, the corruption...that armies, cultures and ideas arrive at its borders with force but the people endure and thrive – that I understand.

Tea, the commodity, seems to be the latest chapter in the way Vietnam engages the world. The same enduring characters are present - greed, ideals, exploitation and expert opinions, all forcing themselves on a country that has its own way of doing things. Despite everything that has happened up to this point, there is a small chance this time, the play will not end in tragedy. 

Tea, the leaf, has been grown and sipped in Vietnam, rather in the country now defined as Vietnam,  for close to 3,000 years. In the mid 19th century, the French established modern tea production on what could kindly be called plantations. In a century the industry had grown to 33,000 acres of tea under cultivation and 3 state sponsored agricultural stations. By 1946 the French abandoned their enterprise with the dual hardships of WWII and the encroachment of communist rule.

India and Taiwan were next to ‘help’. In the first years of India’s democracy, they lent technical expertise for the production of Indian-style black tea, a tea largely unfamiliar to the green tea loving Vietnamese. Taiwan, likewise altruistically set up Oolong production in the central highlands. Then came the Russians, a tea loving a culture, whose investments and machinery helped, well I hate to say modernize in conjunction with the backwardness of Soviet state, but that is the best my personal thesaurus can come up with, modernize production. The US-Vietnam conflict and a post war government that could be viewed both as corrupt and impoverished, definitely exploited by international powers and sanctions, did little to promote the tea harvest. 

In the mid 80’s the communist regime reformed its economic polices. The tea industry was part of this ‘renovation’, which included transferring land to individuals for private ownership and formation of VINATEA to promote and improve the tea industry. A government/private entity, VINATEA manages 60,000 acres of plants, 34 factories and is partnered in a half-dozen multinational ventures.

After 2 decades of investment, the export crop has doubled but there are still problems. Modernization has been difficult and expensive. Vietnam lacks some of the institutionalized knowledge that Sri Lanka, China and India possesses, which makes it hard to process tea leaves internally - adding value to the crop. Acting as its own worst enemy, some growers do not adhere to international grading standards and misrepresent the quality of their product. The country’s export crop is at the whim of both monsoon weather and countries, like Kenya, who dump its crop on the world market driving down prices. This wouldn’t matter so much if the industry was predicated on producing fine grade tea leaves, but it’s brutal if you are selling a lower quality leaves for tea bags or bulk tea that will end up in sugared or diet Snapple.

So international groups of investors and advisers are pushing the Vietnam tea industry to focus on growing premium tea for export. The carrot and stick here are loans and loan forgiveness. According to various sources tea production employs somewhere between 1.5 and 2.5 million Vietnamese, so what will happen to these workers when the crop is exported for processing outside the country? Is everyone going to switch to making Nikes and flatscreens?

Are we witnessing growing pains of an industry that will supply tea to meet the growing demand or are we viewing something insidious, an exploitation of a resource and region by outside forces? Wish I had the answer, until then I am buying my tea leaves from Tao of Tea, an entity small enough they can bypass the curious intentions of the International Money Fund and buy processed leaves from small growers and producers. Well that and root for the country I have such an affinity for to forge their own path. 

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