Vietnamese Litchi Favored in Many New Markets

With premium quality as a result of right production process and strict supervision, Vietnamese litchi has been highly appreciated by consumers in Japan, Australia and Singapore.

Conquering fastidious markets

2020 is the first year Japan imports Vietnamese fresh litchi. As soon as arriving at Japanese supermarkets, Vietnam's fresh litchi has been favored by Japanese consumers for quality. Supermarkets sell out almost all litchi in a day.

As of mid-June 2020, nearly 50 tons of litchi was exported to Singapore from Hai Phong Port and 100 tons was expected to be shipped to this market by the end of this litchi season. At the end of June, 9 tons of Thanh Ha litchi from Hai Duong province was destined to arrive in Australia by sea.

According to the Ministry of Industry and Trade, the average retail price of fresh litchi in Japanese supermarkets is equivalent to VND550,000 (US$23.7) per kilogram, 10-15 times higher than the domestic price. Vietnam is expected to export 200 tons of fresh lychee to Japan this year.

For Singapore market, Vietnamese litchi is now quoted at SGD5-6 per kilogram. Singaporean consumers highly appreciate the quality of Vietnamese litchi fruit. After two weeks on the shelves, many supermarkets have no litchi left to sell. The reputation of Vietnamese fresh fruits has gradually been affirmed in Australia and created a firm premise for Vietnam to export high-quality litchi to other markets.

A majority of litchi is grown in Hai Duong and Bac Giang provinces of Vietnam. Bac Giang is the largest litchi producer by acreage in the country, with an area of over 28,000 ha, expected to harvest 160,000 tons in 2020, an increase of 10,000 tons over 2019. In the past years, litchi of Bac Giang has been exported to many countries like the United States, Russia, Canada, South Korea, China, Singapore and Thailand.

According to the data released by the Hai Duong Department of Industry and Trade, in 2020, the province has planted about 9,800 ha of litchi and expects to harvest 43,000 tons of fruit. Thanh Ha District and Chi Linh City are the biggest litchi growers in the province. A half of the output is for domestic consumption and the rest is for export. Besides traditional Chinese market, Hai Duong fresh litchi is currently exported to Japan, Singapore, Australia, the United States and EU countries.

Although the quantity of litchi exported to fastidious markets is still modest relative to the total output, the successful entry into new markets has affirmed the quality and brand of Vietnamese litchi.

Directions for agricultural products

The success of the new litchi crop in 2020 is expected to be a good example for other crops to follow the path, especially the upcoming longan season. Currently, many other Vietnamese agricultural products are favored in the international market such as cashew nuts, coffee, vegetables and dragon fruits. The enforcement of some new-generation free trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU - Vietnam Free Trade Agreement (EVFTA) will open up many opportunities for agricultural exporters.

The question is which standards are applied to exports? Although fresh litchi has plenty of room to make inroads into demanding markets, the number of companies eligible for purchasing and exporting litchi is very few. Therefore, the key to successful export is following the production process and closely monitor product quality.

For example, to meet export requirements to Japan, litchi gardens must be cultivated according to a special process; granted a standard planting area code; and have production diary and other records. Japanese specialists thoroughly examine all stages, from the tightness of the disinfecting chamber to the amount of disinfectants and the likelihood of proper operation. The fruit is shipped by air. After about seven hours of transport, it will be received by Japanese partners and distributed to the market.

In addition, this entire litchi area certified with the planting area code for export to Japan must meet GlobalGAP production standards. The Plant Protection Department under the Ministry of Agriculture and Rural Development supported the selection and allocation of 19 eligible planting area codes to 103 ha grown by 107 farmer households, which harvest about 600 tons a year. Standard facilities for steaming, sterilization, storage and packaging are also built.

To reduce transportation costs, thanks to closed tight control of product quality from planting and harvesting to packaging and application of technological innovations, the preservation of fresh litchi can be extended to 35 days, convenient for exporting by sea to other countries.

In the upcoming crop, central authorities will focus on promoting products and introducing it to exporters to connect and sign contracts with partners in Japan, the U.S., Australia and other markets. Vietnam targets a 30-50% export growth a year.

By Huong Giang, Vietnam Business Forum