Nepali coffee and pashmina, despite having high potential on securing a good deal of export earnings from foreign markets including the European Union (EU), have failed to do so over problems such as low volume of production and lack of initiative.

Speaking at a programme organised by Nepal Chamber of Commerce on Tuesday, EU Ambassador to Nepal Veronica Cody said Nepali coffee and pashmina were among the fastest selling items in the EU market.

“Provided the promotion of these products, it can help Nepal to minimise the trade deficit with EU countries,” opined Cody, adding that the EU was considering giving Nepal preferential treatment to promote the country’s products.

However, Nepal’s low export volume to the EU is a concern. According to the Nepal Coffee Producers’ Association, Nepal exported 260 tonnes of coffee in the last fiscal year against the country’s production of 550 tonnes annually.

Shyam Bhandari, former president of the association, said the publicity of collective trademarks of both coffee and pashmina might have helped attract foreign buyers. ‘Specialty Coffee’—the collective trademark of Nepali coffee has been registered in the EU and seven other countries including Japan and Korea.

According to Bhandari, Nepali coffee is in the process of getting registered in the US and Australia. “The increased participation in events such as international trade fairs has also helped in promoting the country’s farm product.”

Bhandari said the improved quality of coffee could also have helped attract foreign buyers. The Nepali farm product has to meet a minimum standard of quality as defined under the code of conduct, before it can be sold under the Nepali trademark. These include receiving the organic certification, coffee production at an altitude of 600 metre and growing Himalayan Arabica beans in particular.

As per the association, coffee plantations are expanding rapidly, mainly in 13 districts of Western Nepal. Arghakachi, Gulmi, Palpa, Kaski and Syangja among others are the major areas for growing Nepali coffee.

Similarly, coffee production has significantly increased in Lalitpur, Makwanpur, Dhading and Nuwakot of late. As of 2016-17, coffee plantation is done in land areas totalling 2,646 hectares spread across the country, shows the statistics of the Nepal Tea and Coffee Development Board.

Bhandari said that Nepali coffee fetches good price in South Korea and Japan as well. According to him, Nepali coffee cost up to $14 per kg in these countries.

As part of the government’s Nepal Trade and Integration Strategy 2016, coffee and pashmina were identified as high priority goods for export. The government has also outlined four strategies for promoting Nepali coffee that include improving the quality of coffee cherries, developing support capacities for coffee related cooperatives and ensuring more organic certification, strengthening national sector development coordination and enhancing recognition of Himalayan specialty coffee in domestic and foreign markets.

Likewise, Nepali pashmina is another highly exportable commodity. Pushpa Man Shrestha, former president of Nepal Pashmina Industries Association, said the duty free quota free system offered by EU countries has helped boost sales of the commodity in these countries.

According to him, EU countries stand in second position after the US as the main buyers of Nepali pashmina. Germany, Italy and the United Kingdom are the main importers of the Nepali product.