YEN BAI Enterprises and farmers have closely cooperated to build organic cinnamon growing areas, investing in high-tech factories to deeply process cinnamon products for export.
Son Ha Spices Company Limited accompanies the people of Lao Cai and Yen Bai to build an organic cinnamon material area. Photo: Thanh Tien.
In the period of 2021 - 2025, Yen Bai province focuses on supporting the development of sustainable cinnamon production in an organic direction to meet domestic and foreign market demand, with the goal of increasing output and boosting exports to developed markets such as Europe, the US, Japan, etc. Actively replicating cinnamon development models in the direction of intensive farming and organic production towards sustainable forest management certification. The formation of clean raw material areas that meet international standards has had the active participation of large processing and exporting enterprises.
Businesses change their business philosophy
Son Ha Spices Company Limited has been purchasing cinnamon raw materials in Yen Bai and Lao Cai provinces for more than 30 years. In 2015, the Company officially established a branch in Yen Bai. In 2018, the Company continued to expand, invest in infrastructure and build a factory in Yen Hop commune (Van Yen district, Yen Bai).
Son Ha Company specializes in processing and exporting cinnamon, star anise, and pepper products. The main export markets (accounting for 95%) are to the US and European countries.
According to Mr. Le Van Long - Head of Project Department (Son Ha Company), in the past, the Company mainly purchased cinnamon and exported it to relatively easy-going markets such as India, Bangladesh, and China. These markets did not have high quality requirements but only wanted to buy products at low prices. Since 2015, the Company has changed its business philosophy, gradually building a sustainable production and business model, joining hands with farmers to establish organic cinnamon growing areas; investing in high-tech factories to deeply process cinnamon products. This entire process is carried out according to strict international standards.
Switching to a production and business model according to sustainable standards and criteria will of course be much more difficult and complicated, but the Company determines that it is the right path, and if businesses and people want to develop sustainably, they must definitely follow it.
Cinnamon products with guaranteed quality are exported by Son Ha Company to demanding markets such as the US and European countries. Photo: Thanh Tien.
"When we produce products that comply with international processes and regulations, we have successfully conquered demanding but potentially larger markets such as the US, Japan, Europe, etc.
In the first phase, the company spent a lot of time gaining the trust of farmers, training them, and helping them change old farming practices that had been formed for hundreds of years. After the change, the company spent many more years continuing to accompany farmers to manage product quality according to the set standards," said Mr. Le Van Long.
Joining hands with farmers to build raw material areas
Sharing the story of working with organic cinnamon farmers in Bac Ha district (Lao Cai province), Mr. Le Van Long said that Bac Ha is a mountainous district with over 80% of ethnic minorities. Here, cinnamon trees have great potential, bringing income and creating jobs for people, especially for ethnic minorities. In many key cinnamon growing areas, farmers' main income is from cinnamon (accounting for about 75 - 80% of total income).
People in Bac Ha district have been growing cinnamon for a long time, but mainly spontaneously, without understanding the technical process of cultivating and harvesting cinnamon. Investment in cinnamon production is still limited, and cinnamon growing and harvesting techniques are still rudimentary. People also do not have information about potential markets (especially export markets) as well as mandatory standards. Due to the uneven quality of cinnamon harvest and lack of connection with buyers, cinnamon is often produced and sold locally at low and unstable prices.
In 2019, Son Ha Spices Co., Ltd. cooperated with the GREAT Project, the Netherlands Development Organization (SNV) and the Lao Cai Agricultural Extension Center to develop a value chain and build a market system for cinnamon in Nam Det commune (Bac Ha district). Activities focused on the production and trading of high-value organic cinnamon through harvesting, production, processing techniques and better connections between farmers and high-end consumer markets.
Thanks to higher income and more convenient product consumption, people trust and stick with organic cinnamon production enterprises. Photo: Thanh Tien.
Son Ha Company has conducted internal surveys, assessments, selections and training for more than 300 households in the commune on the principles of organic farming from planting, caring, harvesting and preserving products. Understanding the risks from the use of pesticides and herbicides to health and the environment, people have gradually completely eliminated the use of these drugs in the farming process, developing production in a sustainable direction.
To date, more than 300 households with an area of nearly 1,300 hectares of cinnamon in Nam Det commune have been granted organic certification according to EU and USDA standards. With this certification, people can buy cinnamon at a more stable price. Son Ha Company also signed contracts with farmers to buy cinnamon if the quality is guaranteed. The company focuses on developing a purchasing network, building dozens of large and small contacts to each village. All contacts are trained on how to purchase goods, quality standards that meet the Company's requirements and how to evaluate the value of goods according to each quality.
In addition to purchasing cinnamon, ensuring stable output for farmers, Son Ha Company also rewards farmers who practice and comply with organic farming principles. More than 550 million VND in rewards have been delivered to members of the organic cinnamon supply chain in Nam Det commune (Bac Ha district), of which people received more than 400 million VND and purchasing agents received more than 150 million VND.
Closely monitor production stages
In Yen Bai province, since 2015, Son Ha Spices Company Limited has coordinated with local authorities to build groups, raw material areas and cinnamon product processing areas. Training farmers on sustainable cinnamon cultivation processes and production of high value-added cinnamon products such as cinnamon flutes. Building a system of agents and purchasing agents to each village.
Son Ha Company always closely monitors the stages of care, purchasing, and preservation to ensure cinnamon products meet standards. Photo: Thanh Tien.
Currently, in addition to the more than 2,500ha of regular and organic cinnamon material area, the Company is also carrying out procedures to certify the cinnamon material area to meet UEBT/RA standards (Ethical Biodiversity Trade/Sustainable Agriculture).
Mr. Truong Minh Hoan's family in An Thinh commune (Van Yen district) has been attached to cinnamon trees for more than 20 years. Since 2015, his family and other households in the village have been instructed on organic cinnamon growing techniques by Son Ha Company and agricultural extension officers. To date, more than 5 hectares of cinnamon of Mr. Hoan's family have been certified organic.
Mr. Hoan shared that before there was no cinnamon project, the value was not high, the market was unstable. Now people feel secure in production, cinnamon has a brand, the company also buys products directly for people so they feel secure in production.
Son Ha Company's processed cinnamon products meet the very strict standards of export markets. Photo: Thanh Tien.
In each raw material area, Son Ha Company has an internal inspector in charge and conducts an assessment of farmers' compliance with the principles of organic production. For organic raw material areas, the Company's technical staff supervises purchasing agents to ensure traceability and no contamination during transportation, processing, and storage. The Company provides free sacks and ropes to agents and farmers with organic products to ensure no cross-contamination. Every year, the Company develops a policy of paying billions of VND in rewards to farmers and agents purchasing organic cinnamon products.
In addition, the Company supports livelihood development and social security such as native tree planting models, vegetation maintenance, livestock models, support for waste collection tanks, clean water, equipment at schools and medical stations... to help ensure sustainable development in the community.
Mr. Le Van Long - Head of Project Department (Son Ha Spices Co., Ltd.) added that recently, the Company has received support from Yen Bai province through the project of developing a model of linkage, product consumption and deep processing of high-quality organic cinnamon products. The Company helps people obtain organic certification for the European, American, Japanese and Korean markets. Up to now, the Company has signed direct contracts with thousands of households in Lao Cai, Yen Bai and has more than 4,000 hectares of cinnamon meeting organic certification standards and many other international certifications.
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