Agricultural Restructuring: On Right Track

9:23:58 AM | 7/14/2021

The complicated development of the COVID-19 pandemic has negatively impacted agricultural production. However, with active solutions to clear difficulties and create new breakthroughs, Vietnam's agricultural exports made impressive growth of 3.84% in the first six months of 2021.

Many bright spots

According to the General Statistics Office, the production value of agriculture, forestry and fisheries expanded 3.84% in the first six months of the year, of which agriculture (cultivation and husbandry) increased by 3.71% (with livestock expanded by 5.73%), forestry rose by 3.98%, and fishery increased by 4.25%.

Many localities have also flexibly converted inefficient rice production land of ​​48,100 ha (37,900 ha in the South and 10,200 ha in the North) into growing other crops including vegetables, fruits, perennial industrial crops and culture aquatic species of higher economic results and for non-agricultural purposes. In addition, short-term vegetables, industrial crops and fruit trees all increased in acreage and output over the same period in 2020. Fishery faced numerous difficulties in export; lower pangasius price and saltwater intrusion; however, it enjoyed favorable weather at sea, decreased fuel prices, and incentives of CPTTP and EVFTA trade pacts.

Regarding forestry, Mr. Do Quoc Toan, Director of the Agro Processing and Market Development Authority, Ministry of Agriculture and Rural Development, said that the export value of agricultural, forest and aquatic products reached US$24.23 billion in the first six months, up 28.2% year on year. Strong exports included woodwork, rubber, tea, pepper, cashew nuts and vegetables.

Wood products recorded a breakthrough growth of 74.8% year on year to US$8.1 billion in the first half of 2021. Notably, shipments to five key markets - the United States, China, the European Union (EU), Japan and South Korea - increased sharply. Specifically, the United States was the largest export market with a turnover of US$6.7 billion, up 59.8%, followed by China, US$4.75 billion, up 32.1% year on year. Besides, entry to Peru, Australia and Thailand also achieved positive results.

Analyzing these impressive growth rates, Deputy Minister of Agriculture and Rural Development Phung Duc Tien said that agricultural export is on the right track, with a focus placed on improved quality and increased exports to key markets. Cooperatives and businesses made good use of market opportunities on high demand for agricultural products in many countries owing to impacts of the COVID-19 pandemic. The Ministry of Agriculture and Rural Development has coordinated with central and local agencies to actively research, forecast and take advantage of new-generation free trade agreements to boost agricultural exports and promptly remove difficulties against businesses in circulation and cross-border trade.

Actively capturing the market

To realize the goal of US$45 billion of agricultural export value 2021 (higher than the government’s target of US$42 billion), the Ministry of Agriculture and Rural Development will coordinate with central and local agencies to actively implement consistent solutions, with a focus on key products to compensate for underperforming products, a representative from the ministry said. Specifically, the ministry targeted to earn US$21.5 billion from agricultural exports, US$14 billion from forest products and woodwork, US$8.5 billion from seafood, and US$1 billion from other items.

From a business perspective, Mr. Phan Van Toan, Director of TAT Vietnam Wood Import Export Co., Ltd based Thach That district of Hanoi, said, the company has to date received export orders from the EU for enough operation until the end of the year. However, in the long term, the company wants to be provided with adequate and timely information by authorities to effectively take advantage of EU-Vietnam Free Trade Agreement with contents related to plywood products.

Minister of Agriculture and Rural Development Le Minh Hoan said, in the coming time, to create new breakthroughs, the agricultural sector will continue to change the mindset of agricultural production toward increased commerciality, actively control input and output markets. Accordingly, the sector will strengthen trade promotion and develop export markets; reform production and trading forms; prioritize support for business and cooperative development to apply advanced management technology to form production and consumption chains. The ministry will develop responsive scenarios to fluctuations in the international market; readily activate the agricultural product supply and demand data system; and research and recalculate the cultivation calendar to avoid coincidence with cultivation seasons of importing countries.

By Do Ngoc, Vietnam Business Forum