State needs solutions to reduce logistics cost for farm produce

HÀ NỘI — The State should develop solutions to reduce high logistics costs in trading agricultural products to improve the competitiveness of Vietnamese farm produce on the market, according to experts.

The transportation cost has accounted for 61 per cent of total logistics cost for fruit and vegetable products. —Photo kinhtedothi

The logistics costs have accounted for 12.2 per cent of seafood product value, 19.8 per cent of rice product value and 29.5 per cent of fruit and vegetable value, Nguyễn Duy Minh, vice chairman and general secretary of the Việt Nam Logistics Business Association (VLA), said.

Especially, Minh said the transportation cost has accounted for 61 per cent of total logistics cost for fruit and vegetable products, followed by handling costs with nearly 20 per cent of the logistics costs.

At an online conference on the logistics costs in the value chain of Vietnamese agricultural products held on Thursday in Hà Nội, the experts said that the factors behind the high logistics cost included high transportation cost, high fees and charges of foreign shipping companies and restrictions on ports and infrastructure.

Besides that, new rates of infrastructure fees set by localities and the implementation of special inspection or quarantine quality inspection were also reasons for the high logistics costs, they said.

Lê Văn Quang, chairman of the Minh Phú Group Joint Stock Company, said that the transportation cost of a shrimp container was only VNĐ41 million from Việt Nam to the US and VNĐ16 million from Việt Nam to Japan but this cost was VNĐ80 million from HCM City to Hà Nội.

Similarly, the transportation cost for a shrimp container from HCM City to a border gate with China in the northern region was VNĐ100 million, while a shrimp container shipped from Ecuador to China was just half, even though the distance between Ecuador and China is far greater than from Việt Nam.

Quang said that the cause of this was too many toll stations on land. Therefore, the State needs to have solutions to cut domestic transportation costs.

Trần Thanh Hải, deputy director of the Import and Export Department under the Ministry of Industry and Trade, said that value of agricultural products is low while transportation costs are high. Besides that, agricultural products need cold storage and professional transport vehicles. These two factors have also put great pressure on logistics activities for agricultural products.

He said the high logistics cost has caused weak transportation infrastructure and uneven distribution of ports. The central region has low demand for transporting goods but has many ports while the Mekong Delta region has high demand for goods transport but lacks ports.

In addition, there are many problems in the connection between transport vehicles and logistics centres and between seaports.

To solve those problems, Hải said an important solution is investment in developing large agricultural logistics centres to ensure the quality of farm produce in storage.

Besides that, the State needs to put more investment in improving transport infrastructure on waterways, including ports, because transportation is cheap, he said.

Minh said the State should plan regional logistics centres to create favourable conditions for production and trading of farming products. Technology also has an important role in traceability, monitoring the quality of goods and connecting transport companies online.

Director of the Department of Agricultural Product Processing and Market Development Nguyễn Quốc Toản said the planning of developing logistics centres according to regions would promote linkages between localities.