With certain difficulties in exporting to the Chinese market, fruit and vegetable exports this year are forecast to only reach about 3.2 billion USD, which is significantly lower than the target of about 3.8 – 4 billion USD set at the beginning of the year. To increase the value added, the Vietnamese fruit and vegetable sector needs to focus on deep processing as well as market diversification.
DURIAN IS ABOUT TO TAKE THE PLACE OF DRAGON FRUIT
According to the General Department of Customs, in September 2022, the value of fruit and vegetable products reached 250 million USD, up 8.1% compared to September 2021. However, in the total 9 months of 2022, the value of fruit and vegetable products is estimated at 2.45 billion USD, down 11.1% compared to the same period in 2021.
Based on the data of the General Department of Customs, the representative of the Export-Import Department (Ministry of Industry and Trade) said: In the structure of fruit and vegetable products in August 2022, the leading fruit and vegetable products in terms of export value reached 1.36 billion USD, down 21% compared to the same period in 2021. Remarkably, while dragon fruit exports with the largest value went down sharply, the exports of banana and durian have a strong increase in value.
Vietnam’s fruit and vegetable sector need to continue to move strongly in product structure towards increasing processed products and reducing exports of fresh products. (Photo: N. Thanh)
Processed products are the second-largest category in the structure of fruit and vegetable exports. In the 8 months of 2022, the export value of this category reached 660.9 million USD, up 11.1% compared to the same period in 2021. “The demand for processed fruits and vegetables is increasing globally but Vietnam has only met a small portion,” said the representative of the Import-Export Department.
From the perspective of the export market, Mr. Dang Phuc Nguyen, General Secretary of Vietnam Fruit and Vegetable Association, assessed that in the 9 months of this year, the fruit and vegetable exports to many markets such as the US, Japan, EU, etc has increased sharply up to 100%, however, the export to the Chinese market has decreased strongly.
Deep analyzing the aspect of export commodities, according to Mr. Nguyen, currently, Vietnam’s key export fruits are dragon fruit with a turnover of over 1 billion USD/year, followed by commodities such as mango, longan, grapefruit, rambutan, mangosteen, etc. “Notably, durian shall be a potential commodity of Vietnam with turnover expected to surpass the dragon fruit, reaching about 2 billion USD/year,” Mr. Nguyen said.
He explained that: “China has officially granted permission for Vietnamese durian to be officially imported. Recently, Vietnamese enterprises have started exporting hundreds of tonnes of durian to China, which is welcomed by consumers in this country. Each year, China spends up to 4 billion USD on durian, of which Thailand accounts for 90%, while the remaining 10% is for Vietnam and Malaysia. Regarding durian exports to China, Vietnam has advantages in terms of geographical location, and low transport costs which significantly increase its competitiveness. “
MUCH DEPENDENCE ON LARGE MARKETS
According to Mr. Nguyen, in the past time, the implementation of new-generation FTAs such as the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), and Vietnam – EU FTA (EVFTA), etc has helped Vietnamese fruit and vegetable products increase competition and expand the export market. However, this year, due to significant difficulties in the Chinese market when this country still maintains a “Zero Covid” policy, it is forecast that the full-year fruit and vegetable exports will only reach 3.2 billion USD, down 10% compared to 2021. This figure is quite small compared to the export target of 3.8 – 4 billion USD set at the beginning of the year.
According to Mr. Do Quoc Hung, Deputy Director of Asia – Africa Market Department (Ministry of Industry and Trade), despite being one of the 13 main agricultural products of Vietnam, Vietnam’s fruit and vegetable exports only account for about 1.4% of the world’s total fruit and vegetable imports. Many markets have not been fully exploited by Vietnamese enterprises. For example, in Japan, there is a 20 billion USD demand for vegetable imports every year. Vietnamese fruits and vegetables exported to Japan only account for about 3% of the total imports, which is too low and needs to be promoted.
Notably, in the Chinese market, Mr. Hung analyzed, although Vietnam has exported a large number of vegetables to this market, the figure is quite small compared to its potential. The competitiveness of Vietnamese goods in China is not high. Each year, China has a demand for banana imports of about 1 billion USD, of which the Philippines currently accounts for 50% of the market share, Cambodia for 20%, and Vietnam for only 16%. In terms of mangosteen, China imports 800 million USD per year, and Thailand alone accounts for 700 million USD.
“Vietnam’s dragon fruit has an advantage in the Chinese market but China’s dragon fruit growing area is increasing strongly. Vietnamese enterprises need to quickly update the information to adjust accordingly, ” Mr. Hung stressed.
One of the limitations of fruit and vegetable export pointed out by the leaders of the Asia – Africa Market Department, is that we are dependent too much on large markets; when the large market is in difficulty, it has immediately affected Vietnam’s exports. “In the context that exports are slowing down and deep processing is increased, market diversification through specialized trade promotion activities for fruit and vegetable products is very important. Enterprises need to improve their competitiveness to be able to export fruits and vegetables into tough markets, ” Mr. Hung said.
The representative of the Import-Export Department also emphasized: “Vietnam’s fruit and vegetable sector needs to continue to move sharply towards increasing processed products and reducing exports of fresh products. The exporters need to promote investment in processing technology, post-harvest preservation, and logistics development for fruit and vegetable transportation. “