Agricultural Export in October: Prices Push up Value

This year’s export outperformance is resulted from good harvests and prices. Given current development, the country is estimated to earn US$23 billion from export of agricultural, forest and aquatic products, according to the Ministry of Agriculture and Rural Development.

 

In the first 10 months, major agricultural products like rice, cassava, coffee and black pepper were projected to earn US$11.6 billion, up 45 percent year on year; aquatic product production brought in US$4.95 billion, up 23.2 percent; and forestry products garnered US$3.4 billion, up 16.2 percent. For the first time, Vietnam’s rice export prices are close to those of Thailand, averaging at US$500 a tonne, representing an on-year increase of nearly 7 percent over the same period in 2010. With this advantage, exported rice has played an important role in Vietnam’s export in general and agricultural, forest and aquatic product export in particular.

 

Vietnam exported 80,000 tonnes of rubber worth US$342 million. With this result, this commodity has asserted its strengths and potentials. Export value to all markets rose although volumes slid in some markets. Export prices in the first nine months of 2011 increased 56.3 percent over the same period of 2010. This was the main driving force for export value to jump high.

 

In general, export prices of agricultural, forest and aquatic products gained in 2011. Cassava export prices rose 24.5 percent in the first nine months from a year ago to US$355.9 a tonne. Shrinking domestic supply pushed up coffee export prices by 53 percent to US$2,209 a tonne.

 

Besides, black pepper exports in October was forecast at 10,000 tonnes worth US$72 million, totalling 120,000 tonnes and US$702 million in the first 10 months, representing an increase of 15.2 percent in volume and nearly 2 times in value over the same period in 2010. Black pepper export prices climbed 69.1 percent over the same period of 2010 to US$5,730 a tonne.

 

To boost exports, Vietnamese businesses constantly seek and expand export markets. To traditional markets for Vietnamese agricultural, forest and aquatic products like the United States, South Korea, India and Thailand, Vietnam continues fulfilling its commitments on quality, and expanding sales.

 

At present, the Asian market is Vietnam's largest rice market as it accounts for about 60 percent of its shipments, followed by Africa (24 percent) and Americas (8 percent). Indonesia remains the largest single importer of Vietnamese rise, with import volume rising more than 3.4 times and value climbing 2.8 times over the same period of 2010. Export values to Senegal and China also increased more than five times and more than three times, respectively. Although shipments to Singapore and the Philippines shrank, Vietnam quickly found out new markets like Bangladesh, Senegal, Ivory Coast and Ghana to offset the reduced volume. Indeed, Vietnam’s rice export market will likely continue to expand in the future. According to statistics, Mekong Delta companies are expanding the exportation of agricultural products to new markets like the United Arab Emirates (UAE). In October, the UAE imported 20,000 tonnes of rice and 2,000 tonnes of fish worth over US$10 million, bringing the total value to US$118 million in the year to date. This is a potential market for Vietnamese exporters.

 

Limited pepper supply dented shipments to global markets. However, export value still jumped high in all markets like the United States, United Arab Emirates, India and Pakistan (over 2 times) and Egypt, Spain and Singapore (more than 3 times).

 

Nevertheless, the value of Vietnam’s exports remains very low because they are mainly exported in raw forms. In addition, they incur intermediary costs like port and handling, leading to low real value. In the coming time, Vietnam needs to have more long-term policies to earn the highest value from these commodities.