While exports of many agricultural and aquatic products grew strongly in the first 5 months of 2022, the fruit and vegetable sector went against the general trend with a continuous decline in the last 5 months…
Agricultural product processing enterprises are having difficulties in the market. (Photo: Internet)
The statistics of the General Department of Customs show that the export value of fruit and vegetable in the first 5 months of the year was estimated at 1.43 billion USD, down 16.3% compared to the same period in 2021.
According to some enterprises producing and exporting processed agricultural products, a series of factors such as the Covid 19 pandemic, conflicts between Russia and Ukraine, and global inflation has caused the consumption trend of the global market to change strongly. Consumers in many countries are increasingly tightening their spending, only prioritizing essential goods such as food. Some additional product lines, snacks, and local specialties no longer attract customers as before.
DIFFICULTY IN EXPORT
Director of Van Phat Co., Ltd (Trang Bom, Dong Nai) Bui Thanh Van said that the export of frozen and dried vegetables and fruits has never been as difficult as now. Production input costs increased by 20-30%, while output was difficult to consume because domestic consumers prioritized essential goods. Even the Chinese market now has many risks. “Recently, our company exported three containers of dried fruits to China, the goods were stuck at the border for more than 3 months, the company wasted hundreds of million dong in warehousing”.
Mr. Doan Trung Ngoc, an owner of a processing facility of dragon fruit, mango, and dried jackfruit for export in Hung Thinh commune (Dong Nai), said that, in the last few months, the main market is China. However, this market has suspended imports of these products, causing the output of dried fruits increasingly difficult. Regarding other markets such as Russia and South Korea, it is difficult to find new customers, old customers’ orders have also dropped sharply.
“It is forecast that in the coming time, export markets and domestic consumption of dried fruits are still difficult, so many gardeners are not investing because they are concerned about making more and more losses,” Mr. Ngoc said.
At the Preliminary Conference of the Cashew Sector in the first 6 months of 2022, Mr. Tran Van Hiep, Vice President of Vinacas, analyzed that: The Russian-Ukrainian conflict and global inflation have caused people to spend more money on essential needs. This is leading to non-essential goods such as cashew nuts, dried fruits, and processed fruits will be consumed slowly. Meanwhile, China, a large market of Vietnam, still maintains the “Zero Covid” policy that makes the export of cashew nuts as well as other agricultural products continue to be at a disadvantage.
“The export in 2022 will continue to be difficult due to the high prices of seagoing ships compared to before the Covid-19 pandemic. Meanwhile, the price of exported cashew nuts did not increase at the same time as the price of raw cashew nuts. So, the factories could not balance processing costs and export prices. Therefore, the amount of exported cashew nut is expected to decrease in the following months, which may last until the end of 2022, ” Mr. Tran Van Hiep said.
The amount of exported cashew nuts is expected to decrease in the following months, which may last until the end of 2022. (Photo: Internet)
Having the same opinion, Mr. Ta Quang Huyen, Director of Hoang Son 1 Joint Stock Company (Binh Phuoc), said that enterprises are having difficulties when the price of raw materials increased by 15 – 20% higher than the previous year and the cost of gasoline and transportation continuously increased. Meanwhile, the export prices of cashew nuts did not increase, even decrease. In Binh Phuoc, many small processing plants had to suspend their production to “cut the losses”. Big factories also reduced the capacity because the more processing, the more losses.
To survive in the context of high production costs, many enterprises accepted to reduce profits and tried to open more markets to balance production activities. After the Covid-19 pandemic, the tourism industry is on the way to recovering, some processing enterprises catch this opportunity to promote on-site consumption channels for the needs of consumers such as gifts for visitors. Besides, some enterprises are also interested in bringing goods to the countryside, to traditional markets, small shops, and stops on national highways. Other enterprises make efforts to expand export markets and pay attention to markets such as Cambodia, Laos, and Thailand.
INVESTMENT IN HIGH-TECH AND ONLINE EXPORT
Vietnam’s agricultural, forestry, and aquatic products have conquered many international markets but exports are just focused on 4 major markets, including the US, China, Japan, and South Korea. Therefore, Vietnamese enterprises always have to look for new opportunities to expand the market, find new customers to reduce the dependence on some key markets, and increase the advantage of goods.
According to the statistics of the General Department of Customs, the export value of Vietnam’s fruit and vegetable goods in the first 5 months of 2022 is estimated at 1.43 billion USD, down 16.3% compared to the same period in 2021.
Mr. Huynh Thai Hoa, Director of E-commerce Center – OSB Company (official authorized agent of Alibaba Group), said that Vietnam’s processed agricultural products and fruits are of great interest on Alibaba.com. With a customer base in 240 countries and territories around the world, including two major markets, the US and China, the opportunities for Vietnamese enterprises to export online are huge. “Recently, there have been several markets increasing demand for processed agricultural products, such as the US, Turkey, Bangladesh, Russia, and African countries, Vietnamese enterprises can take advantage of this opportunity, ”Mr. Hoa informed.
According to Mr. Nguyen Minh Duc, Deputy General Secretary of Vietnam E-commerce Association, through international e-commerce platforms, Vietnamese enterprises can reach many customers worldwide in a simple, cost-saving way compared to the traditional way of going to international fairs and meeting each customer. Now, Vietnamese enterprises can export online through Alibaba.com (wholesale) and Amazon.com (retail).
In addition, to overcome difficulties, and improve the processing capacity of agricultural products for domestic and export markets, all sectors need to implement many solutions to promote the technology of preserving and processing agricultural products. Ms. Bui Thi Hanh Hieu, General Director of Bao Minh Agricultural product processing Joint Stock Company (Hoang Mai District, Hanoi), said that: Along with the proactive investment in cold storage systems, processing agricultural products, reducing post-harvest losses by enterprises, the functional sectors need to have policies to support capital sources and technologies for enterprises to invest in this field.
There should be policies to encourage high-tech investment in the processing sector. (Photo: Internet)
According to Deputy Director of Vietnam Institute of Agricultural Sciences (Ministry of Agriculture & Rural Development) Dao The Anh, the planning of the cold storage system must be suitable for each production area; it is necessary to have small cold storage managed by cooperatives, small and medium-sized enterprises in fruit growing areas.
Deputy Minister of Agricultural & Rural Development Tran Thanh Nam commented that: localities need to have policies to encourage high-tech investment in the processing sector to increase the proportion of high-value-added agricultural products, and reduce the production and export of raw products. The MARD will strengthen coordination with localities to support new investments and expand the capacity of processing facilities for standard raw material areas; build chains in product production, preservation, and processing; and focus on developing enterprises and cooperatives in the field of preservation and processing of agricultural products.