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Is market and quality the trump-card in the agriculture sector?

Is market and quality the trump-card in the agriculture sector?
Author: Thanh Nguyen - Thanh Thuy
Publish date: Friday. June 29th, 2018

Vietnam's agricultural products are present in about 180 markets around the world with many top export items. In order to make the agriculture sector grow sustainably and more effectively, the ensuring standard and products quality as well as timely updates for market information is considered as "trump-card".

Exported agricultural products have the advantage of large quantity supply but not ensuring strict requirements on quality. Source: Internet

Establish the market information agency

Speaking at the agricultural seminar with the topic "Solutions for trade development of Vietnam agricultural products", within the framework of the Vietnam Economic Forum 2018, which took place on June 5/6, in Hanoi, Mr. Vu Truong Ca , Chairman of Lina Network said that the "trump-card" is the market. At present, agriculture is developing very well, having advantages in terms of geography, people, policies...

Vietnamese people are very smart, creative but they always consider the status of "the loss of the price" and vice versa, even "lost season", and must concentrate on rescuing the crop. Therefore, it can be seen that Vietnam has not met the market, because we have to find out what is the demand in order to supply appropriately.

Regarding this issue, Dang Kim Son PhD., former director of the Institute of Policy and Strategy for Agriculture and Rural Development (Ipsard), Ministry of Agriculture and Rural Development (MARD) analyzed that: Currently, the agricultural sector of Vietnam has 10 export items which are in the "top" billion USD. All tropical plants and tropical farms have their own market, Vietnamese farmers and enterprises are well-organized on production.

In the market, the most important is market information. Currently, neither MARD nor the Ministry of Industry and Trade have market intelligence agencies. If considering agriculture as the "front", then what needs to be established for the market is firstly an information agency. This agency does not need to belong to any government, ministry or sector, and should be in the form of public-private partnership.

As a person with 20 years’ experience in market analysis for the business, according to Mrs. Vu Kim Hanh, President of the Vietnam Association of High Quality Business Enterprises: There are two solutions that will be very effective. One is to set up a market research team that always "updates" information for farmers, businesses, ministries. The second is the need to organize a group of young professionals to go to all prestigious international fairs to get information and learn.

Ensuring the standard and product quality

Mrs. Hanh added that the "trump card" to develop Vietnam's agriculture is standard and added value. "Two years ago, when I went to survey with cooperatives, farmers and businesses to support the development of domestic market and export, the shocking reality I discovered was that farmers, businesses are less interested in standards, especially international standards. This is because Vietnam mainly exports raw agricultural products, semi-unregistered, does not consider papers. It is difficult to alert the market about Vietnamese agricultural products, she said.

To further clarify the importance of product quality and standards in export, Mrs. Hanh cited the fact that Vietnamese enterprises only export their products, including shrimp and shrimp paste to the US market, but the export is quite often smooth. The reason is because the product is fully certified according to the requirements and standards of the market. The company knows how to build factories that meet the standards from the beginning.

From the perspective of the business, Mr. Tran Thanh Hai, Vice Chairman of Central Group (Thailand) said: Vietnamese agricultural products need to be strictly controlled on quality and brand, while increasing value added for product. Vietnam is one of the five largest tea exporters in the world. Although customers highly appreciate the ability to supply large quantities of cheap tea, but Vietnamese tea is mainly exported raw, no brand so low profit. Besides tea in recent years, Vietnamese rice and pepper have also suffered from strong competition from Cambodian exporters.

"If we cannot make a difference, Vietnam will lose its export advantage. In addition to focusing on market research and product quality improvement, enterprises also need to invest in technology to design, process and pack products accordingly and participate more deeply in the value chain. That increases the profit in the export process... ", Mr. Hai said.

Commenting on the story of what is a “trump-card” for the development of Vietnamese agriculture, Mr. Tran Thanh Hai, Deputy Director of the Import-Export Department under the Ministry of Industry and Trade, said that this is the problem on mechanism and institutions. Generally, in the investment of all the fields, agriculture in particular, businesses need capital, land, but they also need the mechanism, which is allowed by the Government, and the State encourages this mostly... This is the problem that needs to continue to disassemble, facilitate in the future.

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