Banks tighten credit, businesses and coffee growers suffer

The credit limit has caused many businesses, cooperatives and people in the Central Highlands to pile up difficulties in this year’s coffee harvest.

Enterprises “sitting on fire” because of thirst for capital

Coffee is entering the harvest season, the demand for loans of businesses is increasing to serve production and business in the last months of the year. However, it is very difficult for businesses to access capital because the bank’s credit limit has expired.

Mr. Le Anh Tuan, Director of Ia Cham Coffee One Member Limited Liability Company (Ia Grai District, Gia Lai Province) has been sitting on a bonfire for a few days now when customers keep calling to ask for payment of expenses in the past few days. coffee trading. No money to pay, Mr. Tuan made an appointment with customers in turn, on the other hand, found a way to rotate capital.

Every year, at the time of coffee harvest, banks are comfortable lending money to businesses to buy coffee for people to process for the domestic market as well as for export. However, before this year’s coffee harvest, banks have tightened credit, making businesses unable to disburse capital as planned. This makes it difficult for most businesses to find a way out.

Mr. Tuan said that every year, the Company still regularly deals with Agribank Bank  branch in Ia Grai district. However, this year, the company was informed by the bank that the loan used in coffee purchase is no longer available, while the company’s loan limit is nearly 10 billion dong.

According to Mr. Tuan, currently, it is very difficult to pay for households who are contracted to grow coffee 

difficulties, and customers who trade coffee with the Company are also having to pay their debts. If the bank does not disburse in the near future, the Company has to suspend the transaction of buying, selling and purchasing coffee.

“For more than 2 weeks now, the bank seems to have given up, now the company only knows how to take money from sales to manage. However, the sale is currently not collecting money because customers are also indebted, “said Mr. Tuan.

Mr. Tuan said that this year’s coffee crop, the Company traded about 6,000 tons of fresh, with the current price of about 8,600 VND/kg. Thus, the Company needs to have a budget of at least VND 20 billion to rotate capital for this year’s coffee harvest season.

“All year, businesses and people only look forward to the coffee harvest at the end of the year. Therefore, we hope that banks will consider and facilitate the settlement of loans to rotate the source of goods, otherwise businesses will freeze,” Mr. Tuan suggested.

In Kon Tum, many businesses are not better when they cannot raise capital from banks to buy coffee from people. Ms. Pham Thi Tuyet, Director of Nguyen Huy Hung Coffee One Member Limited Company (Dak Ha district, Kon Tum province) said that at this time every year, the company buys about 5,000 tons of green coffee to serve. domestic and export markets, so capital is very large.

If every year, the bank does not tie up credit, the company does not have to rush to buy fresh coffee to prepare for delivery to customers. This year is different, the coffee purchasing company will have to be more moderate. At the same time, shorten the process of drying coffee to deliver to customers to collect cash flow for the Company.

“Previously, banks still provided loans, but from the beginning of October until now, businesses that want to borrow have to register capital from loan packages, so it will be more limited than in previous years. Although the credit tightening has not been affected much in the field of purchasing agricultural products, it is also limited in purchasing coffee compared to previous years, “said Ms. Tuyet.

There should be a separate mechanism for the coffee industry

The leader of a coffee company in the area of ​​Ia Grai district (Gia Lai province) said that currently, in the peak season for coffee purchasing , people are importing coffee for the company. However, the business is stuck in cash flow. At the end of the year, the amount of coffee harvested in the Central Highlands provinces is very high, so businesses need more capital. The current tightening of credit, plus the increasingly low price of coffee, makes businesses even more miserable.

“The Central Highlands provinces have their own characteristics, the economy depends mainly on the coffee industry. Especially, at the end of the year, the amount of coffee harvested is very large, so it is necessary to have a separate mechanism for the Central Highlands provinces to get loans for coffee trading, stabilizing economic life”, this leader. said.

Not only businesses, cooperatives themselves as well as people are affected by loans. Mr. Nguyen Tan Duy, Director of Phuong Hoang Construction – Trade and Service Cooperative (Duc Co district, Gia Lai province) said that during the harvest season, the cooperative needed capital to buy coffee for the people, but the banks were lending airlines, now encounter a lot of deadlock.

“Currently, the cooperative needs to borrow about 10 billion VND to buy stored coffee for processing. However, in Duc Co district, there are 4 banks, none of which gives loans, causing the cooperative to face many difficulties, “said Mr. Duy.

According to Mr. Duy, unable to borrow capital, the cooperative has to use its own capital but is very limited, so the purchase of coffee for the people is not much. If there is a large capital, the cooperative will usually buy coffee for the people at a higher price than the market. At present, people have to sell to traders, so the price is forced, greatly affecting the profit of this year’s coffee harvest of farmers.

Mr. Thai Nhu Hiep, Vice Chairman of the Vietnam Coffee and Cocoa Association, said that the credit tightening made coffee businesses in the right season not be disbursed by banks and faced many difficulties.

Besides, now the interest rate is high, so businesses can buy coffee wherever they go, not reserve it like in previous years. From there, leading to pressured coffee prices.

According to Mr. Hiep, coffee price will fall to less than 40,000 VND/kg depending on the interest rate. Accordingly, the higher the interest rate, the lower the price of coffee . If the coffee price is less than 40,000 VND/kg, the grower will not make much profit. The reason is that this year, the cost of materials is very high, the cost of labor is also high, and the interest rate is also high. Moreover, without credit, businesses are not interested in buying reserves.

“Every year, banks lend money to businesses to buy goods, but this year there is no money to buy coffee, leading to a lot of dependence on the export market,” Mr. Hiep shared.