Farm produce exports – a highlight of the economy

Fruits are among the agricultural sector's export items with outstanding growth in the first seven months of 2017.

Farm produce is among some of the key export items of the Vietnamese economy. With many products present in over 30 markets worldwide, farm produce exports were a “highlight” in the panorama of the national economy in the first seven months of 2017. However, there is still a lot of work for the agricultural sector to do in order to fully tap into the export value of such products.

Exports surge, markets expanded

As shown by statistics released by the Ministry of Agriculture and Rural Development (MARD), Vietnam’s agro-forestry and fisheries export revenues were estimated at US$3.11 billion in July, lifting the total export value during the seven-month period to US$20.45 billion, up 14.7% compared to the same period last year. Fruits, vegetables, wood items, cashew and coffee were among the export items with outstanding growth. Aquatic products posted the largest figure in terms of the export value, hitting approximately US$4.3 billion so far this year, representing a year-on-year increase of 17.5%.

According to Dr. Nguyen Do Anh Tuan, Director of the Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD), farm produce exports are a “highlight” of the Vietnamese economy. In the period of 2011-2016, the export value of Vietnam’s farming products registered an annual growth rate of 12.7%. In 2011, Vietnam reported 19 export markets of over US$1 billion in value, however, only five years later the figure had jumped to more than 30.

It can be said that farm produce is one of Vietnam’s strengths thanks to its national competitive advantages. However, the MARD’s analysis of the market’s supply sources has shown that in 2017, the global consumption demand for agricultural products continues to expand and grow in orientations towards goods of higher values, but the prices of farm produce tend to fall slightly. Therefore, it is of urgent need for the agricultural sector, as well as producers and exporters of farm produce, to conduct thorough research in order to identify the market demand, aiming to avoid the situation of an excess supply.

Active branding

According to Le Van Binh, Deputy Director of the National Assembly Office’s Economic Department, fresh produce such as fruit and vegetables are currently one of the agricultural sector’s strategic items, for which the export markets have been expanded in recent times. However, these commodities have remained dispersed and are yet to be effectively organised. In export markets, Vietnamese fruits have only made it onto the shelves of small shops and supermarkets, with the same situation also seen among many other fruit and vegetable items. Therefore, it is necessary to strengthen value chain management capabilities as well as to develop trademarks, so that these kinds of goods will have more opportunities to become familiar products on foreign markets.

From his viewpoint, Dr. Tran Dinh Thien, Director of the Vietnam Institute of Economics, said that there are currently numerous opportunities to expand the export market for Vietnamese agricultural produce, but difficulties still remain, in terms of technical barriers and fierce competition from other countries’ products. Give that fact, Vietnam’s agricultural sector should focus on improving quality, facilitating intensive processing and developing potential markets and strategic goods items. In addition, the sector needs to attract businesses with considerable potential to make investments and join farmers in building the production value chain; at the same time, enterprises will be mainly in charge of holding dialogues as well as building and setting up the export markets.

In order to promote the values of Vietnam’s agricultural produce, alongside the efforts made by businesses and farmers, the State should strengthen investment in developing an information system on the world’s farm produce markets, aiming to provide relevant support for producers, importers and exporters of farming products, towards avoiding losses and minimising risks. Furthermore, it is necessary to adjust policies in orientations towards attracting investment in agriculture and actively supporting the improvement of the quality of products, technical requirements, and the building of Vietnamese agricultural produce brands on the global market.