Challenges facing Vietnam’s agricultural export

Despite its rich agricultural resources, including major crops such as rice, coffee, and rubber, Vietnam faces significant challenges and fierce competition in accessing international markets for its agricultural exports.

One of the biggest challenges for Vietnam's agricultural export sector is price competition. Many other countries offer similar products at lower prices, making it difficult for Vietnamese agricultural products to access markets and maintain a competitive edge. This is particularly overwhelming in major agricultural sectors like rice and coffee, where competitors such as Thailand, India, and Brazil can produce at lower costs.

Currently, international markets demand increasingly high quality and food safety standards. Complying with these regulations and standards requires stringent production processes and high investment costs. The lack of a reliable quality control and food safety system also makes it difficult for Vietnamese agricultural products to penetrate demanding markets like the US, Japan, and European countries.

Weak infrastructure and logistics pose significant challenges to Vietnam's agricultural exports. Transporting products from farms to seaports and from seaports to export markets can be hampered by underdeveloped infrastructure, traffic congestion, and a lack of efficient transportation resources. This affects the ability to supply goods on time, causing lost opportunities and reducing the reliability of Vietnamese agricultural products in international markets.

Moreover, Vietnam is significantly impacted by climate change and natural disasters. Events such as droughts, floods, and storms can cause severe damage to agricultural products and disrupt the export process. This is particularly concerning in the agricultural sector, where farmers and export businesses face risks related to yield and product quality.

International markets increasingly trend towards protectionism and the imposition of trade defense measures. Countries may impose import restrictions, high tariffs, or unnecessary technical regulations to protect domestic production. This creates a challenging competitive environment for Vietnamese agricultural products trying to access and maintain export markets.

Export regulations can also be a significant challenge. Export regulations related to certification, quarantine, customs procedures, and necessary documentation can be very complex and require strict compliance. Non-compliance can lead to import refusals or delays in procedures, affecting market access.

Experts suggest that Vietnamese agricultural exports face many challenges in accessing and maintaining international markets. From price competition and high-quality/food safety requirements to infrastructure and logistics issues, climate change and natural disasters, protectionist markets, and complex export regulations, all these factors impact Vietnam's agricultural export capabilities. To overcome these challenges, support from government agencies, improvements in infrastructure and production processes, and efforts to enhance quality and food safety to meet international market requirements are essential.

Regarding this issue, Mr. Le Thanh Hoa, Deputy Director of the Department of Quality, Processing and Market Development (MARD), noted that Vietnam has been participating in the agricultural export market for about 30 years. From exporting only USD 20 million in 1990, agricultural exports have grown significantly, reaching approximately USD 53 billion in 2023, and achieving USD 24 billion in the first five months of this year, making Vietnam one of the world's major agricultural exporters.

Meanwhile, Deputy Minister of Industry and Trade Phan Thi Thang assessed that despite many difficulties and challenges, agriculture has become the backbone of the economy and continues to affirm its abundant production capacity, diverse products, and significant supply capability for the world market with competitive advantages from 16 FTAs covering major markets like CPTPP, EU, ASEAN, etc.

“Vietnam is currently the second-largest supplier of coffee globally, the largest supplier of cashew nuts and pepper, and the third-largest rice exporter,” said Ms. Phan Thi Thang.

In recent years, agricultural and food exports have consistently been a bright spot in Vietnam's economic picture, showing spectacular breakthrough growth even in difficult economic conditions and declining markets.

In the first five months of 2024, growth has remained stable, with agricultural, forestry, and fishery export turnover estimated at USD 24.14 billion, up 21% over the same period in 2023.

Exports to major markets showed positive growth, such as the US (up 23.9%), China (up 8.6%), and Japan (up 6.6%). The export value of items in the agricultural sector also grew positively compared to the same period last year, with coffee reaching USD 2.9 billion (up 44.1%), rice USD 2.65 billion (up 38.2%), fruits and vegetables USD 2.59 billion (up 28.1%), and shrimp USD 1.3 billion (up 7.5%)...

Nguyen An Phan