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Macadamia set to be "billion dollar tree"

Released at: 16:14, 14/03/2015

Macadamia set to be "billion dollar tree"

Despite being called the "billion dollar tree", the planting of macadamia trees in Vietnam is at the center of some debate.

by Ngoc Chi

Mr. Pham Huu Tu, a farmer in Thanh My commune in Thach Thanh district, northern Thanh Hoa province, planted macadamia trees when it was being introduced on a trial basis in 2006. He recalled that, at the time, a government official visited his farm and gave him a document on macadamia trees and asked him to try planting it because it would bring a richer yield than the acacia trees he had been growing. So he learned how to plant and grow the tree and in the process met many people who had found success in growing macadamias.

He then decided to cut down all his acacia trees and replace them with macadamia trees. The first of the three years it took was the time he felt the most pressure, because he had to wait for them to grow and bloom. When the harvest came, however, his family was extremely happy after collecting 500 kg of macadamias and earning VND20 million ($1,000). His farm now has had 500 trees and he expects to harvest three tons, after harvesting 1.7 tons last season. Each kilogram of macadamias is priced at VND80,000 ($4).

Macadamias are considered a “billion dollar tree” in Vietnam. It was recently proposed that it become a strategic crop of the central highlands. According to Mr. Vuong Dinh Hue, Head of the Central Economic Committee, macadamia trees bring higher value and can be intercropped with other trees such as coffee, pepper, cashew nuts and bananas. “We honestly believe that Vietnam can become a center for macadamias, not only in the region but also in the world,” he said. “However, during the development process it is necessary to avoid planning and growing cheap macadamia trees.” 

Vietnam’s climate is very favorable for macadamia trees. I estimate that with an average output of four tons per hectare, farmers can earn VND100 million ($4,760).

Mr. Martin Novak, an expert about macadamia from Australia.

Vietnam's climate is very suitable for planting macadamia trees. According to Mr. Pham Duc Tuan, Deputy Director of the Thanh Tay Institute for Research and Technology Development of Agriculture, macadamia trees require a temperature of less than 17C and low humidity. This means that not all types of climates are favorable for their growth. In 100 years there have only been 80,000 ha of macadamia tress planted around the world. Vietnam, however, has suitable climatic conditions and soil. Macadamia trees have been grown in the country’s northwest since 2002. After ten years of trials, results showed a survival rate of up to 98 per cent. In central highlands provinces the area for macadamia trees has reached thousands of hectares.

Many enterprises have therefore adopted plan to grow the tree in recent times. The Him Lam Corporation and LienVietPostBank have introduced a roadmap for the investment and development of macadamia trees, with investment capital of VND20 trillion ($950 million) in the first of five years.

Mr. Nguyen Duc Huong, Deputy Chairman of LienVietPostBank, said that in the context of coffee, rubber, pepper and cashew nuts aging, restructuring and seeking new strategic industrial crops has become urgent. With high nutritional and economic value, macadamia trees are considered a top choice for the central highlands. In fact, about 360 macadamia trees can be planted on each hectare. After the harvest, farmers will collect 5 tons per hectare and earn about VND600 million ($28,500) per hectare. Meanwhile, coffee only yields 3.8 tons per year and revenue of VND155 million ($7,000). Because of the potential presented by macadamia trees, many investors have prepared investment plans and some banks have expressed a willingness to provide loans to farmers.

There’s no denying the potential of macadamia trees. Its planting, however, has sparked a lot of debate. According to Mr. Tuan, in the last 100 years only 80,000 ha of macadamia have been planted around the world while Vietnam intends to plant 200,000 ha, which seems excessive. “It is necessary to have a development strategy for macadamia trees, in order to avoid Vietnam simply becoming a cheap provider of raw materials,” he said. “If planting reaches 200,000 ha, however, Vietnam will lead the world in macadamia trees.”

'Nobody can deny the economic value of macadamia trees. In Vietnam, however, the number of enterprises that can process macadamia nuts is limited. It is therefore necessary to carefully research the consumption market for macadamia nuts."

Mr. Cao Chi Cong, Deputy Director of Vietnam Forestry Administration

Meanwhile, Mr. Nguyen Ba Ngai, General Director of the Vietnam Forestry Administration under the Ministry of Agriculture and Rural Development (MARD), said that plans for the tree are totally reasonable as they can be planted on an area of about 48,000 ha in the northwest and 9,000 ha in the central highlands. In addition, they can be intercropped with other crops such as coffee and tea, with intercropping in the central highlands reaching up to 150,000 hectares.

The implementation of plans for developing macadamia trees can’t be rushed, however, because carefully research is needed before broad application. Mr. Hue said that it’s very important for farmers to learn from the experience of other countries that have had success with macadamia trees. “In addition, we need to determine its value chain in order to improve export value and avoid a bumper crop creating lower prices,” he stressed. 

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