Friday , September 29 2023

Agro-produce exporters favor Chinese market despite border congestions

Sluggish customs clearance and temporary border gate closures are frequent, but farm produce exporters prefer the Chinese market, given its large intake volumes and less demanding quality control.

Thousands of container trucks carrying agricultural produce, mainly fresh fruits, have been stranded in border areas in the northern province of Lang Son for the past three weeks because of slow customs clearance and temporary closure of Tan Thanh and Coc Nam border gates. The Chinese side is strengthening Covid-19 prevention measures at border areas.

Despite the difficulties they face because of the ensuing congestion, many enterprises told VnExpress that they still favored the Chinese market.

Nguyen Khac Huy, director of the Hoang Phat Fruit Company, said his firm was seeking different ways to export fruits to China, which is the second biggest economy and the most populous country in the world.

“The total volume of goods we export to the European Union, Singapore, Japan and other markets in a whole year is sometimes equal to that exported to China in just two days,” he said.

The director of another agricultural products exporter in the southern province of Vinh Long said 70 percent of his company’s total export turnover came from the Chinese market.

Vietnam and China are neighbors, so it is easy for enterprises from both countries to trade goods, and freight costs are many times lower than those other big export markets such as the U.S., Japan and South Korea.

In addition, the Chinese market is more easy-going one, compared to the Japanese or South Korean market. It does not have strict regulations on pesticide residues in imported fruits, for instance, Huy said.

Dang Phuc Nguyen, General Secretary of the Vietnam Fruits Assocation, said the Chinese market is attractive because of four reasons.

First, the Chinese side buys Vietnamese farm produce at prices higher than the Vietnamese market. Second, the Chinese market does not require agricultural products’ quality to be as high as those exported to Europe or the U.S. Third, China does not require modern post-harvest preservation of agricultural produce. And fourth, the short distance that the produce has to travel ensures its freshness.

Hundreds of trucks queue up at the Tan Thanh border gate in the northern province of Lang Son on the morning of Dec. 16, 2021 awaiting their turn for customs clearance. Photo by VnExpress/Ngoc Thanh

Hundreds of trucks queue up at the Tan Thanh border gate in the northern province of Lang Son on the morning of Dec. 16, 2021 awaiting their turn for customs clearance. Photo by VnExpress/Ngoc Thanh

China is a multi-billion-dollar market not only for Vietnamese businesses, but also other countries. Recently, Thailand, Myanmar, India, the U.S. and other countries have been promoting exports to China.

Meanwhile, Chinese farmers have intensified cultivation of several crops, creating greater competition for Vietnamese products.

Recently, China proposed that Vietnam increases goods export via official channels instead of relying on border trade.

Deputy Minister of Agriculture and Rural Development Tran Thanh Nam advised Vietnamese businesses to improve their capacity to meet standards and regulations set by China, and to diversify their export markets.

According to the latest statistics from the General Department of Vietnam Customs, Vietnam earned $1.75 billion from exporting fruits and vegetables to China in the first 11 months of 2021, up 3.6 percent year-on-year despite Covid-19 impacts. China remained Vietnam’s top fruit and vegetables export market with a market share of 54 percent in the 11-month period.

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