The border closure policy between Pakistan and Afghanistan is pushing Vietnam’s tea industry into one of its rare difficult periods in many years. More than 400 containers of tea stranded at Karachi Port have caused direct losses for Vietnamese tea exporters.
Pakistan and Afghanistan have long been two key markets for Vietnamese tea, especially green tea and black tea. According to the Vietnam Tea Association, each year exports to these two markets account for more than 40% of the industry’s total export turnover. In the case of Afghanistan, nearly all of Vietnam’s exported green tea is available in this market. This consumption mainly takes place via the transit route through Pakistan.
For many years, this transportation route was stable and reasonably to the characteristics of Vietnamese tea products. However, the recent border closure policies and tightened cargo controls implemented by Pakistan and Afghanistan have effectively “frozen” this traditional export route. Shipments of Vietnamese tea that have arrived at Karachi Port (Pakistan) are awaiting transshipment to Afghanistan. These shipments have been forced to sit idle, unable to continue their journey, leading to prolonged congestion.
Vietnam’s tea
According to preliminary statistics from the Vietnam Tea Association, more than 400 containers of Vietnam’s tea stranded at Karachi Port. This is a very large number in terms of the scale of the Vietnamese tea export industry. The industry is dominant by small and medium-sized enterprises.
Mr. Hoàng Vĩnh Long, Chairman of the Vietnam Tea Association, said that the failure to clear goods has triggered a series of consequences. First, Vietnamese tea businesses are unable to receive payment from their partners, as most contracts stipulate payment only upon delivery or completion of customs clearance. Meanwhile, many bank loans taken out by businesses have reached maturity. This situation is especially serious toward the end of the year, a period when financial pressure typically intensifies.
In addition to having their cash flow effectively “frozen,” Vietnamese tea companies are also facing substantial additional costs. These include container detention and storage fees charged by shipping lines and port operators. These are unforeseen expenses that further increase the financial burden on businesses. According to feedback from enterprises, if the congestion continues, these costs may keep rising. As a result, total losses could increase significantly.
According to Mr. Long, if this situation continues for an extended period, many businesses will no longer be able to maintain production. They should temporarily suspend operations or scale down to cut losses. More concerning is the fact that most of the stalled shipments are green tea. This is a product that is particularly prone to discoloration, deterioration, and quality degradation if stored for long periods.
Vietnam’s ancient tea tree
Unlike some types of tea that can be stored for extended durations, green tea needs to be consumed within an appropriate timeframe. This is necessary to preserve its color, flavor, and overall quality. Having hundreds of containers of green tea sitting idle at the port not only exposes businesses to the risk of economic losses.
It also threatens the reputation of Vietnamese tea in international markets. In an increasingly competitive environment, even a single shipment that fails to meet quality standards can negatively affect the image of the entire industry. This product-specific characteristic has made the pressure on tea enterprises heavier than that faced by many other sectors.
The current difficulties does not limit to the export stage. They also risk spreading across the entire tea value chain. When export cash flow stops, businesses lose the ability to rotate capital. As a result, Vietnam’s tea enterprises cannot continue purchasing raw materials.
Consequently, many companies should consider reducing capacity or temporarily halting production. This directly impacts tens of thousands of tea-growing households in raw material regions. These households depend heavily on stable procurement from Vietnamese processing tea enterprises.
In the context of rising agricultural input prices and production costs, the inability to sell products or delays in payment could push tea farmers into prolonged hardship. According to the Vietnam Tea Association, if the congestion is not resolved soon, the damage will not be confined to exporting enterprises. It will also directly affect farmers’ livelihoods.
Vietnam’s tea process
In response to this situation, the Vietnam Tea Association has acted early. It has served as a bridge between businesses and relevant authorities. The Association has sent official letters to the Vietnamese Embassy in Pakistan. It has also worked with and sent documents to the Embassy of Pakistan in Vietnam to reflect the difficulties and request support.
Representatives of Pakistan’s diplomatic agencies have acknowledged the petitions. They stated that they would report back to their authorities to seek solutions. However, as of now, no concrete measures have been taken to release the stalled cargo, Mr. Long said.
On the Vietnamese side, the Vietnamese Embassy in Pakistan has also worked with Pakistan’s Ministry of Commerce. It has requested consideration of mechanisms to resolve the issue for Vietnam’s tea shipments. At the same time, the Vietnam Tea Association has sent official letters to Vietnam’s Ministry of Foreign Affairs and Ministry of Industry and Trade. These letters call on relevant ministries and agencies to intervene through diplomatic channels and bilateral trade cooperation.
According to the Chairman of the Vietnam Tea Association, what tea businesses currently seek is not special incentives. Instead, they are looking for practical and feasible solutions to release their goods.
One key proposal is for the Pakistani government to step in promptly. It should issue unified instructions to relevant authorities such as the military, customs, and tax agencies. These instructions would allow Vietnamese tea containers to be cleared for overland transit to Afghanistan. In practice, Pakistan has already applied similar mechanisms to some other countries. However, this has not yet been done for Vietnam.
If this option proves difficult, the Association has proposed another solution. Pakistan could allow Vietnamese enterprises to withdraw their cargo from Karachi Port and transfer it to another port for continued export, or ship it back to Vietnam. This would help minimize losses as much as possible.
More than 400 containers of Vietnam’s tea stranded at Karachi Port have not only caused direct losses to exporting enterprises. They have also created the risk of disruptions to the production chain, with far-reaching impacts on tea growers and the industry as a whole.
The tea congestion incident along the Pakistan–Afghanistan route is a clear warning. It highlights the risks of relying heavily on transit markets. Amid increasingly unpredictable global trade conditions, export sectors—including tea—are facing an urgent need to diversify markets, transport routes, and logistics solutions.
In the short term, however, Vietnam’s tea industry is in urgent need of coordinated action from relevant authorities. This is necessary to resolve the immediate difficulties and release the stalled shipments. Doing so would help safeguard the production–export chain as well as the livelihoods of tea farmers. This is not only an issue for the tea sector alone. It is also a common challenge facing many of Vietnam’s agricultural products as the country deepens its integration into the global market.
Vietnamese source: https://langngheviet.com.vn/hon-400-container-che-viet-mac-ket-tai-pakistan-nganh-che-dung-truoc-nguy-co-dut-gay-chuoi-san-xuat-35068.html
