Study on flower and ornamental sector in Vietnam shows untapped potentials
Vietnam has advantages and enormous potential for the development of flowers and ornamental plants, considering its culture, diverse climate and natural resources for production, its ambition in the world market. Earlier this year, a study about flowers and ornamental plants sector in Vietnam, commissioned by the agricultural department of the Netherlands Embassy in Vietnam, implemented by AGROINFO, was released. It is a compilation of findings and also sheds light on opportunities and challenges influencing the sustainable and prosperous future.
Vietnam’s flowers and ornamental sector
Ranked as the 14th nation with most biodiversity (Nash, 2023), and the world's oldest tradition of cultivating flowers and ornamental plants, Vietnam holds significant potential for the growth and development of flowers and ornamental plants. Flowers and ornamental plants’ products are divided in to two main groups, including cut flowers (Rose, Chrysanthemum, Orchid, Carnation, and Lilies, etc) and ornamental plants (pot flowers and fruits, interior ornamental plants, bonsai trees and others).
In recent years, flower and ornamental plant growing has made remarkable progress in terms of productivity, quality and efficiency, creating jobs for many households and contributing significantly to the GDP of agricultureal sector, thereby contributing to shifting crop structure and building new rural areas. From 2015 to 2021, the gross output value of flowers and ornamental plants sector increased by nearly 2 times with the highest average growth rate of 11.8%/year in comparison with crop sector and other sub-sectors. In 2021, the sector’s gross output was VND 37.97 thousand billion equivalent to 1559 million USD, accounting for 3.99% of total gross out of the crop sector.
From 2000 to now, there was a sharp increase in both area and average income of flowers and ornamental plants. In 2015-2020 period, the average growth rate of the area and average income of flowers and ornamental plants was 11.03%/year and 13.18%/year, respectively. Specially, the average income from planting flowers and ornamental plants was very high (520 Mil.VND/ha/year) in comparison with other crop sub-sectors (about 100-200 Mil.VND/ha).
The total flowers and ornamental plants area in 2021 was 48.91 thousand ha, mainly in Red River Delta, Mekong River Delta and Central Highland regions. These three regions accounted for 76% of total flowers and ornamental plants area. Top provinces/ cities with large area and output of flowers and ornamental plants are Lam Dong (9,740.5 ha), Ha Noi (8,293.65 ha), Nam Dinh (3,390 ha) Ho Chi Minh (2,325 ha), Dong Thap (2,162 ha) and Son La (267ha).
The majority of Vietnam's flower and ornamental plant market is driven by domestic consumption, constituting approximately 90% of the nation's total output. This sub-sector plays a significant role in various aspects of life in various occasions in Vietnam (Lunar new year, marriages, funerals, birthdays, anniversaries, traditional and cultural festivals). With rising incomes allows Vietnam’s burgeoning middle class to buy more expensive and exotic flowers and plants.
Blooming export opportunities
In addition to local consumption, Vietnam's flower indicates significant untapped potential and ample room for growth in the export market. From 2016 to 2022, the export value of flowers and ornamental plants from Vietnam increased with a compound annual growth rate (CAGR) of 8.57% per year. The export value rose from 64.65 million USD in 2016 to a record high of 105.91 million USD in 2022. Vietnam exported flowers and ornamental plants to 44 countries in 2022, with the top 5 markets being Japan, Korea, the Netherlands, the USA and Australia. From 2015 to now, the structure of export product groups for flowers and ornamental plants remains mostly unchanged. Cut flowers (HS0603) consistently dominated the export share with 70.16% in 2022, following by live plants (HS0602) with 25.66%; foliage, branches, etc. (HS0604) with 4.16% and the bulb group (0601) with 0.03%. In 2022, the export turnover of cut flowers reached 74.3 million USD, marking an impressive increase of 131.3% compared to 2015 and 53.2% compared to 2021. This indicates a growing preference for Vietnamese flowers in the global market, attributed to their durability and significantly competitive pricing compared to Dutch flowers.
Opportunities and challenges
The strengths, weaknesses as well as opportunities and threats to Vietnam’s flowers and ornamental plant sector are clarified in the SWOT analysis below:
To read the full study, please click the link below.
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