Vietnam, the world's second biggest coffee producer, is expecting to further boost its coffee trade and export by putting the first national coffee exchange center into operation, local newspaper Vietnam Investment Review reported Monday.

The Buon Ma Thuot Coffee Exchange Center (BCEC) in central highlands Dac Lac province, Vietnam's coffee hub, established in mid-December, initially handles domestic transactions with a standardized quality management system. In the second phase, it will handle direct electronic transactions with the London International Financial Futures Exchange (LIFFE), the world's biggest coffee trading floor.

"The exchange will bring Vietnam's coffee trading to a new professional level, creating a level playing field for traders, and will better protect coffee growers," said Van Thanh Huy, chairman of Vietnam's Coffee and Cocoa Association.

With a four-hectare storage system, the center prevents forced "mass sales" due to a lack of storage which has hurt prices in previous years. By using the storage service, farmers can receive preferential credits to reinvest in cultivation and select the best sales option via public bids at the center.

For BCEC membership, enterprises must have minimum registered capital of 5 billion Vietnamese dong (VND) (312,500 U.S. dollars) and a minimum export or processing volume of 5,000 tons of coffee in the last three years. Local brokers should have a minimum registered capital of 3 billion VND (187,500 dollars), and foreign ones 2 million dollars.

Now, the domestic market's 33 coffee trading businesses use only three local brokers, said the report.

Vietnam exported 767,000 tons of coffee worth 910 million dollars in the first 11 months of this year, down 6 percent in volume but up 38.1 percent in value against the same period last year, according to the country's General Statistics Office.

Source: Xinhua