The paradox: Agricultural exports in Vietnam has always been at the top of the world. However, the actual value is comparably low and farmers are the least beneficiaries and most vulnerable to market changes.
At the national online conference on agriculture, farmers and rural areas taking place on the afternoon of November 26, 2018, representatives of the Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD) reveals that export turnover of agricultural, forestry and fishery products has increased considerably in the past10 years, from 16,484 billion USD in 2009 to 36.37 billion USD in 2017. Notably, Vietnam has always been a country with a surplus of agricultural products with an average export surplus of 8 billion USD / year.
Nevertheless, despite strong growth rate, the majority of them are exported either raw, fresh or briefly pre-processed, while the proportion of deeply-processed exports contributes very little to the total annual export value.
IPSARD representative explained that despites being one of the leading countries in the export of agricultural, forestry and fishery products, 80% of products exported from Vietnam have not paid much attention to branding and lacking logos, labels… while exporting. This leads to a critical decline in prestige and competitiveness, causing a great impact on the agricultural sector in general and farmers in particular.
Specifically, according to statistics from the Department of Industrial Property (Ministry of Science and Technology), among the trademarks registered for protection in Vietnam, only about 15% are from domestic enterprises. Similarly, up to 80% of our country’s agricultural products are sold to the world market through foreign brands without being registered for ownership.
In addition, another weakness is that even though we have participated in the global supply chain, Vietnamese agricultural products are currently limited to the role of providing inputs in the form of raw agricultural products, while the added value of agricultural products mainly comes from processing, packaging, operations and international trade movement. The proposed underpinning is that the technology for pre-harvest and post-harvest treatments in VietNam is still backward, and the establishment of business chains from production, processing to marketing, distribution and consumption has not been developed enough.
Lessons from Japan:
In the conference with the topic “Promoting the application of science and technology in industrialization and modernization of agriculture and rural areas”, Secretary of the Vietnam-Japan Embassy, Mr. Hiroshi Matsuura, emphasized the importance and urgency of creating added value for agricultural products which would improve dispensable profits for farmers.
He provided an example of how a mango in Japan can be sold for about 4,000 yen (about 850,000 VND). However, to attain that price, the farming process has to follow stricter standards. After harvest, the transport and storage process is also strictly monitored by CA technology (a method that helps to limit respiration and makes fruit stay fresh). As a result, Japanese farmers can regulate the market by offering a moderate amount all year round to bring higher and more sustainable values for themselves.
Hence, he suggested that to get higher profit, farmers also need to upgrade their facilities for stockpiling. Otherwise, if the cold storage capacity is held by the purchasing party, the highest profit will go to them as they have the ability to coordinate the market.
(VietnamNet, 2018)
