In the first four months of 2024, the total export turnover of agricultural products reached 10.44 billion USD, marking a 32.5% increase compared to the same period in 2023. Notably, the export turnover of vegetables and fruits amounted to 2.49 billion USD, reflecting a 25.7% increase over the same period in 2023. This achievement is unprecedented since the initiation of the economic renewal campaign in 1986, with Vietnamese fruits and vegetables surpassing the 1 billion USD mark in the first quarter of the year for the first time.
Export turnover of Vietnamese agricultural fruits
According to a report from the General Department of Customs, durian has overtaken dragon fruit as Vietnam’s top fruit export in 2023, reaching $2.2 billion—a fourfold increase from 2022 and accounting for 40.7% of total fruit and vegetable exports. Dragon fruit followed with $613 million (11.1%), bananas at $308 million (7.6%), and jackfruit and mangoes at 5.9% and 4.3%, respectively.
The first quarter of 2024 also saw significant growth in new fruit categories, with coconut exports up 112.6%, longan by 159.9%, macadamia nuts by 113.9%, and almonds by 274.4%. Although Vietnam ranks fifth globally in coconut production, its export value has yet to reach $1 billion. However, the recent growth signals a positive outlook for coconut exports, especially in the cosmetic and health industries.
By the end of 2024, fruit output is projected to exceed 13.5 million tons, a 3.4% increase from 2023, while vegetable output is estimated at 19.7 million tons, rising by about 624,000 tons. This growth is particularly impressive considering the severe heatwaves from El Niño that affected Southeast Asia for up to five months, highlighting the agricultural sector’s resilience.
Main export markets
Currently, 61.4% of Vietnamese vegetables are exported to China, generating $2 billion, a 128.5% increase compared to the same period in 2022. The General Administration of Customs of China has approved 3,140 product codes for Vietnamese agricultural products, mainly covering 12 key items such as watermelon, mangosteen, black jelly, durian, fresh bananas, sweet potatoes, dragon fruit, rambutan, mango, lychee, longan, and jackfruit. Frozen durian and coconut are also being considered for approval.
In 2023, Vietnamese vegetable exports to the U.S. reached $140.5 million, a decline of 11.2% compared to the previous year. Exports to South Korea grew by 13% to $125.1 million, while exports to Japan increased by 5.5% to $105.6 million. Despite the high demand for imported fruits and vegetables in these markets, Vietnamese products maintain a relatively small market share compared to other exporters.
For example, the U.S. imports $46-50 billion worth of fruits and vegetables annually, with Vietnam contributing only 0.6%-0.7% of that total. Similarly, Vietnam’s fruits and vegetables account for less than 5% of South Korea’s $4 billion annual imports.
In the EU market, Vietnam’s agricultural products represent about 4% of the total annual import value, which exceeds $160 billion. The Vietnam-EU Free Trade Agreement (EVFTA), in effect since August 2020, aims to boost Vietnam’s agricultural exports by gradually eliminating tariffs over a 10-year period, improving market access and competitiveness
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Source: Center for digital transformation and agricultural statistics – Ministry of Agriculture and Rural Development
Remaining weaknesses and challenges
80% of Vietnam’s exported fruits and vegetables are fresh products
80% of Vietnam’s exported fruits and vegetables are fresh, while processed products make up only 20%. Processed items mainly include mangoes, passion fruit, almonds, pistachios, canned fruits, and bottled juices. Vietnam has 150 modern fruit and vegetable processing plants with a total processing capacity of 1.1 million tons per year. However, relying heavily on fresh products presents two main challenges:
Quality Management and Post-Harvest Losses: Small-scale, fragmented production leads to difficulties in quality management and traceability. Inadequate preservation and packaging technology result in high post-harvest losses, ranging from 20% to 30% of total production, increasing selling prices.
Logistic Challenges: Long shipping times hinder increasing export volumes to the EU, Australia, and the US. Shipping fresh produce from Vietnam takes 25 days to Australia, 40-45 days to the US, and 30-35 days to the EU. Without enhancing the processing industry, Vietnam will struggle to increase export volumes, especially for fresh vegetables with limited shelf life.
Additionally, the procurement system involves many intermediaries, leading to high costs and reduced competitiveness. The lack of synchronized warehouse systems and logistics services exacerbates this issue. Vietnam’s processing industry also faces constraints in production capacity, product variety, and quality standards. Investment in technology, machinery, and equipment is crucial to enhance competitiveness and enable processed fruit and vegetable products to access the EU market effectively.
Weaknesses in farming techniques
In Vietnam, farmers are highly adaptable in switching crop areas. The area planted with rice in 2015 accounted for 52.4% of the total cultivated area, decreasing to 50.3% by 2020. Farmers have gradually shifted towards perennial industrial crops and fruit trees as these sectors offer higher benefits in terms of export value. However, expanding into new planting areas also brings new challenges. Farmers in these new areas lack knowledge of garden design, techniques for canopy management, and proper care, resulting in delayed fruiting during the initial growth stages. They also lack pest and disease management techniques, leading to reduced productivity and fruit quality.
Particularly with durian, in regions with challenging soil conditions such as saline soil and inadequate irrigation, improper care can hinder plant development, leading to poor growth and a high mortality rate among plants, causing significant losses for farmers and exports.
Impact of weather conditions and climate
In addition to technology and production scale, Vietnam faces significant challenges posed by climate change, storms, increasing inland salinity intrusion, and prolonged droughts, all of which adversely affect crop areas and yields.
In 2024, the prolonged El Nino phenomenon, lasting nearly six months, exacerbated widespread drought and saltwater intrusion across many parts of Vietnam. By April 15, 2024, over 2,000 hectares of crops in Dak Lak province had already been impacted by the prolonged drought. The province, which boasts 858 irrigation works, has seen 44 reservoirs completely dried up and 139 reservoirs operating below 50% capacity. Meanwhile, in the Mekong Delta, a region crucial for nearly 70% of the country’s fruit production, concerns arose as water levels in rivers and canals fell critically low, unable to meet the demands for household, agricultural, and industrial use. Fortunately, by June 2024, conditions had begun to improve, offering Vietnam a valuable lesson in preparing for increasingly complex weather patterns in the future.
Moreover, Vietnam’s vegetable and fruit sectors are significantly influenced by these climatic variations. For example, unlike the Mekong Delta, where durian cultivation can control flowering throughout the year, regions like the Southeast and Central Highlands heavily rely on annual weather patterns for flowering cycles. This dependency results in substantial variability in durian harvesting seasons in these areas, ranging from April to October, with an off-season extending from November to March the following year. Thus, while the Mekong Delta manages to stagger durian harvests effectively, other regions face greater unpredictability due to climate-induced fluctuations in agricultural cycles.
Difficulties with licensing and ensuring product quality
In January 2024, the European Union announced that five Vietnamese agricultural and food products, including chilli, instant noodles, durian, peanuts, and dragon fruit, would be subject to scrutiny upon export to this market. Issues related to Vietnam’s plant quarantine from 2020 to the end of June 2023 resulted in a total of 170 warnings from the EU. Specifically, warnings related to pests and diseases occurred 28 times, while warnings concerning plant quarantine certificates numbered 133; notifications related to other reasons were reported 4 times.
Regarding durians, in the last six months of 2023, Vietnam had three consignments of durians weighing over one tonne each that violated EU regulations. This is why Vietnam’s “king of fruits” has been placed under scrutiny.
Not only in the EU, but durian also faces “yellow card” scrutiny from China. Thirty consignments of Vietnamese durians exported to China were flagged for exceeding the allowable limit of cadmium heavy metal, as per China’s food safety regulations. According to the Plant Protection Department, the main cause of this cadmium contamination in 30 consignments of Vietnamese durians has yet to be determined. Durians may be contaminated with heavy metals during cultivation due to contaminated soil, from water sources and air pollution by factory emissions, or during harvesting when people use untreated water to process durians.
Certainly, these are just cautionary measures, and while there will be challenges, they also present an opportunity for high-quality Vietnamese products to assert their position in markets such as China or the EU, especially with the considerable support in trade tariffs for exports.
Solutions
Recognizing these challenges, the Vietnamese government has issued directives to develop the agro-forestry-fishery processing industry and mechanise agricultural production. The goal is for Vietnamese agriculture to rank among the top 15 most developed countries by 2030, with the agro-processing industry ranking among the top 10 globally, establishing itself as a hub for deep processing and logistics in global agricultural trade.
The government aims to:
- Restructure agriculture towards large-scale commodity production linked to processing and market consumption.
- Promote the development of large fields with comprehensive mechanization throughout the agricultural value chain.
- Invest in the development of the machinery manufacturing industry and supporting equipment for agriculture with a focus on specialization.
- Establish and develop a synchronized logistics system to enhance the value and competitiveness of agricultural products.
- Increase the application and transfer of scientific and technological advances in processing and preserving agricultural products.
- Train specialized technical personnel and management workforce for the development of mechanization and the agro-processing industry.
- Continue to deepen international economic integration and diversify export markets.
From 2018 to 2023, Vietnam remained the largest exporter to the USA market in Southeast Asia. Vietnam’s export growth rate in 2022 exceeded 100% compared to 2018, while other countries only maintained stable growth rates from 5% to 30%. Although Vietnamese products still have areas needing improvement, their quality and competitive pricing create trust in the US market. With continued technological innovation, Vietnam has ample opportunities to become one of the world’s leading export partners for vegetables and agricultural products.
Vietnamese agricultural products, particularly fruits and vegetables, are diverse and high-quality due to the country’s tropical monsoon climate and extensive 3,260-kilometer coastline. The mountainous regions in Vietnam have a temperate climate suitable for growing a wide variety of crops popular in Europe and the US. However, to comply with export requirements, especially regarding chemical fertilizer content, it is essential to conduct thorough reviews and closely follow procedures to prevent losses and additional costs.
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