November 23, 2011
Vietnam's agriculture industry surpasses production, business challenges
To reach its export value target for the year, Vietnam's agricultural, forestry and fishery industry has overcome both production and business challenges, experts have said.
The Vietnam Association for Seafood Exporters and Producers (VASEP) said that the economic crisis in Europe has greatly affected payments to Vietnamese seafood exporters while the price of raw materials related to processing has increased sharply due to low supply.
General Director of the Van Duc Export Food JSC, based in Ho Chi Minh City, said that many seafood exporters have had little orders from Europe due to low demand and the crisis. Therefore, processing factories have been operating moderately to supply the domestic market.
Nguyen Van Ky, general director of the An Giang Import Export Company, said that the price of tra fish had jumped to VND28,000-28,500 (US$1.33-1.36) per kilogramme, forcing his company to cut spending to avoid losses.
Meanwhile, coffee has also faced declines in export price due to impacts associated to the economic situations in Europe and the US, according to the Vietnam Coffee Association.
Pham Quang Dieu, chief economist at Agromonitor, a farming product analysis company, said that the export volume of rice will gradually reduce by the end of this year because both exporters and importers have done careful business.
In the short term, Vietnam will face difficulties in exporting rice due to high raw material and export prices, he said.
The current domestic purchase price of rice stood at VND7,000 (US$0.33) per kilogramme compared to the previous VND4,000-5,000 (US$0.19-0.24) while export prices have surged to US$570-580 per tonne.
In the medium- and long-term, Vietnamese rice will gain advantages based on Thailand having to export rice at high prices and Indian halting rice exports to ensure food security at home, he said.
But the short-term challenges have not hampered Vietnam in hitting its export targets for farming and seafood products this year, the Ministry of Agriculture and Rural Development predicted.
The ministry expected the farming, forestry and seafood industry to increase to US$23 billion in export value this year against US$19 billion last year.