Fruit and vegetable exports enjoy fertile growth

Fruit and vegetables grossed US$658 million from exports in the first half of 2014, an increase of 132% against the same period last year, meeting 54.83% of this year’s plan.

Last year, their export value hit nearly US$1.1 billion, US$200 million higher than the set plan, and this year’s total export earnings are expected to surpass US$1.2 billion.

High growth in most markets

The Vietnam Fruit and Vegetables Association (Vinafruit) reported that in the first six months the country enjoyed a US$400 million trade surplus from fruit and vegetables.

In the European market, with the exception of dragon fruits, exports of most fruits such as pomelos, mangoes, rambutants are modest. Vegetable exports have rebounded but their overall value is limited.

In late May, the New Zealand Embassy in Vietnam and the Plant Protection Department under the Ministry of Agriculture and Rural Development (MARD) signed a deal to guarantee exporting of dragon fruits to New Zealand.

The agreement opens the door for shipments of high quality dragon fruits to enter New Zealand, said Vinafruit Secretary General Nguyen Van Ky.

According to MARD’s Agro-forestry Processing and Salt Industry Department, in the past year

Vietnamese fruit and vegetables have been exported to more than 40 countries and territories, including China, Japan, the US, the Republic of Korea, Russia, the Netherlands, Thailand, Malaysia, and Singapore.

China is the largest importer, accounting for one-third of total export revenue. Vietnam mainly exports mangoes, longans, lytchees, bananas, dragon fruits, star-apples, and coconuts via Chinese border provinces of Guangdong, Guangxi and Yunnan. However, exports to China are mainly through informal channels with unclear trading methods and verbal agreements, causing a number of inherent risks.

To avoid these risks, domestic businesses must have clear contracts, require bank payment and know their partners well, MARD cautions.

The second largest consumer of Vietnamese fruit and vegetables is Japan which accounts for 7-8% of total export value.

Vietnam mainly exports frozen fruit and vegetables, such as soya beans, cabbage, cucumber, mushroom, cherry, dragon fruits and mangoes. Other products like canned fruit juice and processed vegetables are now favoured in the market. Recently, Japan began to import lychees and sweet corns.

The third largest partner is the US which makes up 5-6% of total export value.

Penetrating demanding markets

Despite quite high growth in the first months, difficulties have arisen due to global complications, especially following the recent East Sea stand-off caused by China’s illegal placement of Haiyang Shiyou-981 rig in Vietnam’s waters.

A possible reduction in Chinese imports is likely to put the burden on the agriculture sector to shift its emphasis to expand into other more high demanding markets.  

Vinafruit Vice President Huynh Quang Dau said in order to reduce overdependence on the Chinese market, businesses should master advanced technology and develop large-scale material zones, enabling them to break into demanding markets such as the EU, Japan and the US.