Farm produce exports to China remain unstable

A farmer waters vegetable at an organic farm in Vietnam - PHOTO: THANH HOA

Although China is a major buyer of Vietnamese agricultural products, Vietnam’s farm produce exports to the Chinese market still face multiple challenges including the use of unorthodox channels for border trade in accessing the market and understanding Chinese consumers’ preferences, Bnews.vn news site noted, citing speakers at a seminar held in HCMC on August 26.

Speaking at the seminar on improving access to the Chinese market for Vietnamese farm produce, Nguyen Hoang Anh, a member of the Council for Consultancy on Administrative Procedures and standing vice chairman of Vietnam’s Digital Agriculture Association, pointed out that because of its similarity in culture and cuisine and its geographic proximity, China has been Vietnam’s strategic farm produce importer for many years. In particular, in 2017, China accounted for 76% of Vietnam’s fruit and vegetable export revenue, amounting to US$3.5 billion.

Vietnam’s farm produce exports to China, however, face difficulties with cross-border trade, which carries various risks since transparency and prestige between enterprises of the two countries are not maintained.

Vi Tich Thanh, economic and commercial counselor at the General Consulate of China in HCMC, noted that in recent years, China has proactively expanded imports to meet its residents’ rising demand for farm produce, with an average import growth rate of 8.8% per year.

Thanh stated that cross-border trade, despite forming a major part of the two countries’ bilateral trade, is unstable and highly risky and is mainly conducted by super-small and small firms.

Small-scale production lines, unstable product quality and low competitiveness are also hindrances to Vietnam’s farm produce exports to China. Moreover, Vietnamese enterprises have yet to proactively seek new market segments in China, Thanh added.

Vietnam, despite being a major farm produce seller, has yet to build a trademark for its agricultural products, which discourages Chinese customers from buying these goods.

Another challenge is that enterprises in Vietnam that export farm produce have failed to learn about the demands of the Chinese market or take into account customers’ tastes and preferences.

Thanh stressed that Chinese customers increasingly require high-quality products.

Addressing the seminar, Vu Tien Hung, head of the Vietnam Trade Promotion Agency in China’s Hangzhou, confirmed that most Vietnamese enterprises have obtained inaccurate information about the Chinese market, adding that few firms have visited commercial departments to gain or share information.

To effectively expand exports to China, Vi Tich Thanh suggested that State agencies actively research the market, understand the situations and trends of that market and draw up and popularize agricultural manufacturing guidance policies.

Besides this, the relevant agencies should also connect policies with customs departments and food quarantine departments to facilitate the farm produce trade. It is necessary to apply advanced processing technology to manufacturing and to build a trademark.

Thanh proposed Vietnamese enterprises cooperate with China’s ecommerce firms to open online stores and supply agricultural products to new supermarkets because ecommerce can help link up manufacturers to consumers.

Nguyen Quoc Toan, acting director general of the Agro-Processing and Market Development Authority under the Ministry of Agriculture and Rural Development, said China is Vietnam’s traditional potential market; however, the market has undergone various changes and introduced new requirements on product quality. Vietnamese enterprises should follow these changes and discover new ways of accessing the market, Toan suggested.

To steadily export farm produce to China, Vietnam should focus on manufacturing high-quality products and packaging and processing products well, he added.

Speaking at the seminar, representatives suggested that formal exports should be enhanced to stabilize trade. In addition, there should be collaboration between departments, embassies and trade commissioners to update information and remove obstacles for Vietnamese firms engaged in exporting farm produce.