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Investment

Last updated: Friday, September 21, 2018

 

Opportunity to Invest in Organic Agriculture

Posted: Tuesday, January 02, 2018


According to the Ministry of Agriculture and Rural Development (MARD), the draft Organic Agriculture Decree and then the Organic Agriculture Development Project 2018-2025 will be soon submitted to the Government for approval.

In the world, organic agriculture used to be a niche market for small groups of consumers but now it has become a big market segment with a trade value of nearly US$100 billion, with about 50 million hectares of cultivated land.

Thriving organic agriculture
In Vietnam organic agriculture has had nearly 10 years of development, but in recent years, organic agriculture has been developed with the participation of large enterprises. So far, 33 out of 63 provinces and cities have developed the model of organic agricultural production with an area of about 70,000 ha (3.6 times that of 2010). There are many forms of investment such as households, groups of households, cooperatives, small enterprises, large enterprises among the others. Organic agriculture production includes many kinds of food, sugar, milk, etc., which have created new organic product lines for domestic market and exports.

As a pioneer in investing in organic production, TH Group has been producing fruit, vegetables, herbs and fresh milk in accordance with European and American standards. In December 2015, there were 37 clean vegetables, five herbs of TH certified by Control Union as organic products. Five fruits and herbs including gac fruit, centella, persimmon leaf, persimmon fruit, and green peanut of TH group are exported to the US market under Total Happiness Naturals brand and TH true Herbal brand. At the same time, at the end of April 2017, Control Union issued organic certification to the TH organic dairy farm and the entire production chain.

According to Mr Nguyen Xuan Cuong, Minister of Agriculture and Rural Development, Vietnam is a country with agricultural production capacity that not only meets the needs of over 93 million people in the country, but also exports to 180 countries. The export value in 2016 was over US$32 billion and in 2017 is estimated at over US$36 billion. With the active participation of large investors such as TH Truemilk and Vinamilk, Vietnam has the foundation to develop stronger organic manufacturing sector.

Golden opportunity
Attending the Forum on "Organic Agriculture Production - Trend of International Integration" held in Hanoi on December 19, Prime Minister Nguyen Xuan Phuc affirmed that besides the task of ensuring food security, the agricultural sector should aim to produce clean, nutritious food. In particular, organic agriculture with the strength to provide high quality products, safety and environmental protection is an important element. Given the current middle-class ratio has reached 30 percent and will increase to 50 percent by 2030, the Prime Minister said that the development of organic agriculture in Vietnam is a "golden moment".
According to some experts, the forecast sales of organic products in the country increased about 18 percent per year.

However, in order to produce organic products, Vietnam needs to overcome the initial stage to catch up with the international market. It is necessary to quickly build a legal corridor and clear mechanisms and policies to promote this industry. At the same time, the lead agency should soon establish a quality standard system and adopt policies to encourage investors to set up independent quality control and certification bodies in the country.

Organic agriculture is not a return to the traditional way of hundreds of years ago, but a combination of the essence of tradition with modern scientific advances and modern management methods. Therefore, the mechanisms for human resource training should also be respected.

In the period of Vietnam's agriculture sector aiming for sustainable development, making full use of advantages and potentials, Vietnam's organic agriculture industry can create a stronger development.

Thanh Yen








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