Why to enter Vietnamese fruit processing market now ?

The Vietnamese fruit industry has been steadily growing in recent years, however, there remains much place for development by applying new technology in production to enhance added value for processed products, grow the share of sustainable profit, and meet domestic and international demand.

According to data from the Ministry of Agriculture and Rural Development (MARD) released at the seminar on Vietnam's fruit processing market and technology on November 21, 2017 in Hanoi, with growth across various segments, Vietnamese fruit production and export value has been continuously growing in recent years: from several hundred million dollars per year to over $1.07 billion in 2013 and reaching $2.458 billion in 2016, the first time exceeding rice exports ($2 billion), and for the first time accounting for more than 80 per cent of total export value.

In the first ten months of 2017, the export value of fruits reached $2.48 billion, an increase of 47.3 per cent over the same period in 2016. Major fruit export products include dragon fruit (about $900 million in 2016), banana, rambutan, longan, litchi, mango, mangosteen, and durian.

Major fruit and vegetable import markets continued to grow in value: from 13 markets importing over $1 million in 2004 to 10 markets over $20 million in 2016. Aside from China, which is the largest market (accounting for 70.8 per cent of total fruit exports), growing volumes have been exported to high-demand markets, such as the US, Korea, Japan, the Netherlands, Malaysia, Taiwan, Thailand, Singapore, and Australia.

However, with the global import value of vegetables and fruits being in excess of $200 billion per year since 2011, Vietnam’s export value is less than 1 per cent of the world market.

In additional, the main exports of Vietnam are fresh fruit, which has lower value and many technical barriers to trade, such as phytosanitary requirements, quick expiration dates, and short fruit life because of limited technology.

“Fruit production and processing in Vietnam is also facing difficulties and challenges due to the small scale of producers and the decentralised production taking place all over the country with little to no linkeages. The quality and productivity of fruit is low, the application of technical equipment is not synchronised, lost harvest is large, the processing technology is not updated, and a far smaller volume of processed food products are exported than fresh fruits. The high cost of transportation (by air) and no brand in the market lead to low added value and low competitiveness of Vietnamese fruit products,” asserted Nguyen Nhu Cuong, deputy director general of the Department of Crop Production at MARD, at the seminar on Vietnam's fruit processing market and technology on November 21, 2017 in Hanoi.