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Vietcombank loan to fund building of cassava processing plant

Released at: 17:14, 09/08/2017

Vietcombank loan to fund building of cassava processing plant

Photo source: Internet

Fococev Tay Nguyen Co. borrows $7.78 million to build plant in central highlands province of Kon Tum.

by Ngoc Chi

Vietcombank has signed a VND177 billion ($7.78 million) credit agreement with the Fococev Tay Nguyen Co. for the construction of a cassava starch processing plant in Kon Ray district in the central highlands province of Kon Tum. 

The plant will have a capacity of 200 tons per day with investment capital totaling VND224 billion ($9.85 million), of which the Vietcombank loan accounts for 79 per cent.

Addressing the signing ceremony, Mr. Dao Quy Trung, CEO of Fococev Vietnam and Chairman of Fococev Tay Nguyen, expressed his appreciation of the cooperation between the company and Vietcombank over recent years and affirmed that the bank will be a strategic partner in the company’s upcoming projects.

Exports of cassava and cassava-based products fell significantly last year, according to the Ministry of Agriculture and Rural Development (MARD).

At 2.6 million tons worth $700 million, exports were down 14.5 per cent year-on-year in volume and 22.5 per cent in value, primarily due to declining demand, particularly in China.

Signing ceremony between Vietcombank and Fococev Tay Nguyen Co. (Source vietcombank.com.vn)

China accounted for nearly 86 per cent of total exports, but according to the General Department of Vietnam Customs, value was down 32 per cent year-on-year.

Malaysia bought 15.1 per cent more but shipments to most other markets, such as South Korea, Japan, and the Philippines, were down.

According to MARD, cassava production has increased sharply over the last 20 years.

The country currently has some 551,000 ha of cassava fields, mainly in the central, central highlands, southern and northern mountainous regions, with the crop now being an important source of income for small farmers.

Cassava yields and production in several provinces have more than doubled thanks to the planting of new high-yield varieties and the adoption of more sustainable production practices.

Many cassava processing factories have invested in upgrading their technologies and installing wastewater treatment systems, reducing pollution.

Starch produced from the cassava root is mainly used as food but is also a raw material for many industries, including pharmaceuticals.

Vietnam was one of the world’s largest cassava exporters in 2015, earning $1.32 billion from exports, a year-on-year increase of 15.8 per cent

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