Vietnam’s farm exports signal bright prospects

The successful conclusion of export contracts for farm produce in early 2022 has been a welcoming sign for local businesses and set the bright tone for the year ahead.

Vietnam's catfish exports are set for a bright year in 2022. Photo: The Hanoi Times

General Director of the Trung An Hi-tech Farming Company Pham Thai Binh said the company is in the process of delivering 15,000 tons of 100% broken rice to South Korea.

In addition to South Korea, the firm is also working on exporting rice to the EU by taking advantage of the EU-Vietnam Free Trade Agreement (EVFTA).

“Last year, we exported around 100 containers of ST24 and ST25 rice to the European market, and the figure may double this year,” Binh said, noting the price of ST24 stays around US$1,000 per ton.

A similar view is shared among other rice exporters, especially with the growing demand from Vietnam’s major rice markets such as the Philippines and Indonesia to build up food reserves.

According to the Vietnam Food Association, Vietnam’s rice exports boomed since mid-March due to rising demand for food in the global market, which subsequently leads to higher prices and revenue for local companies.

In addition, four major import markets of Vietnam’s catfish, such as the US, China, EU, and Asia have also registered greater demand for Vietnam’s seafood.

The Vietnam Association of Seafood Exporters and Producers (VASEP) noted in the first two months of 2022, catfish exports surged by 93% year-on-year to $384 million.

VASEP Vice General Secretary To Thi Tuong Lan expected Vietnam’s exports of catfish to rise by 20-25% against last year, and prices of these products to increase 5%.

Lan estimated a high growth in demand from key markets, including China (31%), the US (23%), CPTPPP (13%), and the EU (6.6%).

Challenges remain

Despite positive signs in farm produce exports, experts warned of growing uncertainties in the global trade environment, due to the Covid-19 pandemic, rising inflationary pressure, and the ongoing Russia-Ukraine conflict.

In addition, the high costs of maritime freight transport and input materials are major challenges for local companies in 2022.

Minister of Agricultural and Rural Development Le Minh Hoan said Government agencies are putting up efforts to resolve trade issues with major markets, especially the US and China, to further boost farm exports.

“Local companies should be aware of the strict anti-virus measures taken by China to avoid possible delay in exporting goods to the country,” Hoan added.

In the long term, however, Minister of Industry and Trade Nguyen Hong Dien called for local businesses to diversify export markets, for which the Government would provide support for firms to better take advantage of free trade agreements and trade promotion activities via digital platforms.

In 2022, the agricultural sector targets an expansion rate of 2.8-2.9%, which is expected to boost farm exports to $49 billion in 2022 and production value by 2.9-3%.