The BCCE, formerly known as the Buon Ma Thuot Coffee Trading Centre, has total charter capital of VND75.5 billion (US$3.5 million), with 42% funded by the People's Committee of Dak Lak Province, reported newswire VnExpress.
The exchange will trade in two products, spots and futures for Robusta coffee, and connect to global commodity exchanges, such as the Chicago Mercantile Exchange. Following Robusta coffee, BCCE plans to trade in black pepper and rubber.
Tran Thanh Hai, BCCE General Director, said last year Vietnam exported 1.6 million tonnes of coffee, but the export value of its coffee only reached around US$3.5 billion — less than other coffee-growing countries, especially Robusta coffee.
Hai said other coffee-growing countries can earn up to US$10 billion from coffee exports each year, while Vietnam, which accounts for about half of the world's Robusta coffee output, earns about US$3 billion from coffee exports.
The trading of Vietnamese coffee at the BCCE will allow farmers to sell directly to buyers at the London Coffee Exchange, he said. That will help Vietnamese farmers avoid being forced to sell at low prices.
In 2008, the Buon Ma Thuot Coffee Trading Centre had no efficient operation because it lacked capital and good operational mechanisms, while many farmers did not have the means to conduct transactions at the centre.
The establishment of the BCCE is expected to solve problems for commodity transactions and help seize business opportunities.
According to the General Department of Customs, Vietnam exported 241,000 tonnes coffee, earning US$511 million in the first two months of the year. Exports dropped 25.3% in volume and 16.4% in value against the same period last year.
