Ample room for processed fruit and veggie to enjoy export growth

According to the Center for Industry and Trade Information under the Ministry of Industry and Trade, the Vietnamese fruit and vegetable industry has enjoyed a successful transition into the processing of dried products and canned juices.

The COVID-19 pandemic is thought to not have negatively affect the global processed fruit and vegetable industry. In contrast, the supply of processed fruit and vegetables has seen an increase, while the export of fresh or frozen products has endured a fall which has forced producers to shift into processing. Meanwhile, price, shelf life, and innovation represent the main drivers to promote the consumption of processed fruit and vegetables.

As a tropical country, the nation boasts favourable soil and climate conditions for producing a variety of fruits. Recent years have seen the country develop a fruit processing industry which currently accounts for approximately 10% of its total fruit output.

As a means of proactively supplying processed products, the MARD is finalizing a draft project regarding developing the Vietnamese fruit and vegetable processing industry, with the goal of raising the standard to be among the leading countries in the world.

In general, the local fruit and vegetable sector has been quite successful when increasing exports to markets, boasting large import volumes and strict requirements on quality and product diversity.

With these results achieved in both 2020 and during the first nine months of 2021, the nation’s fruit and vegetable industry has enjoyed a successful transition into the segment of processing dried products and canned juices.

Furthermore, when developing in the direction of processing, local fruit and vegetables can be controlled in terms of costs, thereby increasing the value of goods by up to four times compared to the price of fresh fruits.

The deep processing of fruit and vegetables will also help to increase the overall storage time and avoid oversupply.

It is forecast that during the remainder of the year and the entirety year of 2022, processed fruit and vegetables will continue to represent a product category with strong growth potential because of convenience and long preservation time.

The presence of retail and e-commerce channels for both developed and developing countries will help to increase the sales of processed fruit and vegetables. Imports of products of fruit and vegetables, nuts, and other plant parts from key Vietnamese export markets such as China, the United States, and the EU have grown at a high rate in recent years.

Consumption trends typically increase due to factors such as a rise in domestic production, convenience of products, and technological improvements aimed at maintaining the quality of fruit. However, the Vietnamese fruit and vegetable processing industry is currently in the form of raw processing and is exported to foreign markets under other brands, thereby leading to a low value-added chain for this industry.

The past few years has seen enterprises investing in the field of fruit processing, with preservation increasing sharply, three times higher than before, with 7,500 fruit and vegetable processing and preservation establishments and roughly 150 processing factories that feature modern technology lines.

At present, the processing industry only meets 8% to 10% of the annual fruit and vegetable output, with more than 76% of exported fruit and vegetables not being processed. In addition, consumption is still in the form of fresh or preliminary preservation, with post-harvest losses remaining too high at approximately 20%.

Compared with the requirements set out in terms of development and integration in line with the new competitive conditions, the fruit and vegetable processing industry continues to face many shortcomings and limitations.