Tien Thinh Agricultural Product Processing Co., Ltd Raising Vietnamese Agricultural Value

Tien Thinh Agricultural Product Processing Co., Ltd has been increasingly known to consumers in many countries through frozen vegetables, tubers and fruits grown in the Mekong Delta, thus helping boost consumption, raise the value of agricultural products and assure farmers. Mr. Pham Tien Hoai, Director of Tien Thinh Company, gives an exclusive interview to Vietnam Business Forum’s reporter on the company’s current operations and plans.

In 2016, Tien Thinh was not a long-standing company (founded in 2014), but it invested VND170 billion in a fruit and vegetable processing factory in Hau Giang province. Why did the company decide to choose this place for the facility?

Fruits in many other countries in the region like Thailand have been well exported to major supermarkets although their prices are always higher than Vietnam’s products. Meanwhile, the Mekong Delta is known as the capital of most of Vietnam's agricultural products, with fruits accounting for over 70% of the country's production, low on price and diverse in type, but they find it hard to reach foreign markets. Vietnam's fruit export value is always lower than other agricultural products because not many businesses have invested in suitable technology to make products that meet export market requirements.

Desired to be a bridge to bring Vietnam's tropical fruits to major markets in the world and support Mekong Delta farmers to raise the value of agricultural products, Tien Thinh Agricultural Product Processing Co., Ltd was founded in 2014.

With a yearly processing capacity of 10,000 tons of products, using modern European technology lines and applying international quality management systems such as BRC, HACCP, ISO 22000, HALAL, KOSHER, GLOBAL GAP and FDA enables Tien Thinh products to be exported to most countries around the world.

As a processor of export agricultural products, what solutions does Tien Thinh Company take to maintain business operations in the midst of complicated market fluctuations, and especially the impacts of the COVID-19 epidemic?

2019 was considered a year of great success for Tien Thinh when it recorded a nearly 200% growth of input purchases and export sales over 2018. Also in 2019, the company’s exported products, worth nearly US$100 million, were exported to fastidious markets such as the United States, Canada, Australia and Japan.

In 2020, the company’s business performance was hurt by the COVID-19 epidemic due to disrupted input supply chains and product output consumption. To maintain stable business in this difficult time, the company outlined following strategies and solutions:

In addition to expanding current lines of strong fruit juices such as passion fruit, custard apple and dragon fruit, the company has promoted research and development (R&D) on new juices and condensed products from other fruits and vegetables to meet new consumer trends of the world market.

The development of dried fruit marshmallow is also a key solution to ensure jobs for employees and further diversify the Company's output products. A representative from COSCO Group will send an expert delegation to assess the factory in October 2020 and some of Tien Thinh's marshmallow products will be available on the shelves of the world-leading retailers by the end of 2020.

While expanding international export markets, from the beginning of 2020, Tien Thinh focused on tapping potential domestic markets by promoting sales on websites and online applications. To date, the company dried fruit marshmallows have been for sale on e-commerce platforms like Lazada, Tiki, Shopee and Sendo and popular supermarkets such as Aeon, Vinmart and Coopmart. The company has also promoted cooperation with Chinese partners to bring plastic products to famous e-commerce sites in China such as Tencent and Alibaba this year.

In 2019, through the legal entity Hanh Nguyen, Tien Thinh carried out the Hau Giang Export Agricultural Logistics Center. Could you please introduce this project?

In 2019, Hanh Nguyen Company was established to construct the Hau Giang Export Agricultural Logistics Center to provide integrated services for agricultural exports such as cold storage and cool storage for rent (capacity of 14,000 tons); fully automated European processing, sorting and packaging line with an hourly capacity of 50 tons of fresh fruits; fresh fruit irradiation system powered by E-BEAM safe and modern technology and electromagnetic accelerating beam of the United States (not using radioisotopes) with a daily capacity of 300 tons; and container and ship booking, transportation and customs declaration services. Currently, Hanh Nguyen is rushing to complete the last stages to prepare for the opening of cold storage, cool storage and frozen storage in early October. Remaining items will be put into operation by the end of 2022.

In addition, the center built agricultural product exchanges to update information on domestic and international agricultural markets, assess consumer demand and quality requirements for each product to deliver early warnings and regulate production. This is also the website to promote Vietnamese fruit brands to consumers all over the world.

The integration of services that foster the alignment of all stages of the agricultural production chain helps reduce production costs and improve competitiveness while creating new values for agricultural products.

What do you recommend central and local authorities do to enhance the competitiveness of Vietnamese agricultural products?

Currently, the Mekong Delta has an insufficient transport infrastructure, a fragmented port system and insufficient seaports, resulting in rising transportation costs. Data showed the product cost rises by US$7-10 per ton of agricultural products. As fruit and vegetable production in the Mekong Delta is typically fragmented, there is a need for merchants to collect fruits and vegetables, resulting in higher product costs and making it hard for tracing the origin. For that reason, it is necessary to build large-scape specialized farming areas to meet market needs in the integration era. In addition, the government has support policies for farmers and agricultural cooperatives acquire necessary training and knowledge to stabilize and improve the quality of agricultural products, for farmers to expand production capacity and ensure output quality to meet requirements of major markets around the world. The government should have more open and accessible credit policies and mechanisms. Last but not least, it is essential to strengthen the cooperation of authorities, scientists, enterprises and farmers to find out new varieties, adapt to climate change, plant off-season crops to ensure year-around supply of fruits and vegetables.

Source: Vietnam Business Forum