By Ho Binh Minh
HO CHI MINH CITY, Dec 9 (Reuters) - Coffee theft has been added to steep borrowing costs and unstable exchange rates as a threat to Vietnam's coffee sector and cited as a key factor supporting domestic and global prices, industry players said on Thursday.
Stealing of coffee cherries from trees has led farmers to pick beans early, leading to lower export quality and possibly affecting coffee flows from Vietnam, the world's second-largest producer after Brazil, following rain delays to the harvest that disrupted bean drying last month.
Concerns over Vietnam's supply were behind London's
robusta futures prices hitting two-year high last month. The
March contract
Robusta prices in Vietnam, which often closely track London prices, eased to 34,600-35,000 dong ($1.8) per kg on Thursday in Daklak, the country's top growing province, down about 1.4 percent from the previous day despite gains in London.
Daklak prices have now jumped 42 percent from a year ago, which appears to have stimulated stealing cherries in the Central Highlands coffee belt.
"Now the situation with coffee theft, harvesting of coffee without ensuring quality, or picking green beans, in the province are evolving with complications," the Daklak provincial government said in a letter this week to all departments and districts.
It urged the authority to "boost strict protection of the coffee area being harvested," while farmers should avoid expanding planting areas to ensure sustainable production and bean quality.
Looting started in November and farmers rushed to pick ripe and unripe cherries early instead of waiting until 95 percent of the crop ripened, traders said.
"The stealing problem is obvious and the authorities have not done much to prevent it," an executive at a coffee processing plant in the central highland province of Lam Dong told Reuters on the sidelines of an international coffee conference.
Lam Dong is the second-largest growing province after Daklak.
Doubling labour costs also made many farmers quicken the harvest, which could lead to green cherries processed through splitters raising the ratio of broken beans, a defect in export standards.
($1=19,495 dong)
(Editing by Ed Lane)