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Farm exports hit record high

HA NOI — This year's export turnover of agricultural produce was estimated to reach a record high US$19.15 billion, an increase of 22.6 per cent on last year, said Deputy Minister of Agriculture and Rural Development Hoang Van Thang at a conference to review the sector in Ha Noi yesterday.

"This figure is very encouraging considering the adverse effects of the global economic slowdown during the first months of the year and the natural disasters suffered," he said.

He said that three export items had surpassed the $3 billion threshold this year: seafood, timber products and rice.

The product which had seen the most significant increase in market value was rubber latex. This year, Viet Nam exported a total of 773,000 tonnes for a turnover of $2.32 billion.

"A 5.7-per cent increase in volume translated into a remarkable 89-per cent rise in value," Thang said.

Rubber prices have steadily increased this year to reach $5,000 per tonne.

Le Quang Thung, chairman of the Viet Nam Rubber Group's board, said the price had been higher than in recent years because many manufacturers had produced less rubber volume, while the rubber latex demand remained high, especially for the auto tire production sector in China, India, Japan and South Korea.

Similarly, the prices of pepper, cashew and cocoa had risen sharply. In the first quarter of the year, the pepper price was about $2,000 a tonne, but it had risen to $5,000 per tonne.

During the last months of the year, the world's pepper volume in storage was small and the main harvest was just beginning while consumption demands had increased sharply recently.

The Viet Nam Food Association increased the floor price for rice exports six times this year.

With a price increase of agricultural products for exports, the coffee, cashew and pepper farmers can earn a profit of VND40-100 million ($2,000 – $5,000) per hectare this year after submitting expenses.

According to projections by the General Statistics Office, agriculture's contribution to the gross domestic product increased by 2.8 per cent this year and its total production value rose by 4.69 per cent.

Director of the Institute of Policy and Strategy for Agriculture and Rural Development Dang Kim Son said advances in the agriculture sector could be traced back to the high demands of the global market and the improving quality of Vietnamese agricultural products.

"We expect to see more improvements as several sustainable development programmes involving the cooperation of big companies are now underway," he said.

According to MARD, the demand for agro-forestry and fishery products in major markets such as the US, EU and Japan would continue increasing next year.

Some new export markets such as South Africa, Middle East also show huge potential.

Obstacles

Son said one major drawback was that the planning of agricultural zones for exports hadn't received adequate attention from local authorities. Experience showed that many farmers switched from cultivation of one crop to another whenever price fluctuations occurred.

He also said that the Government's price stabilisation policies didn't cover many agricultural products and Vietnamese products were still vulnerable to market volatility.

Son highlighted the urgent need for organisational and institutional reforms to ensure stable and sustainable agricultural production. He said that one approach was to establish industry coordinating committees to help the Government implement development strategies and build strong brands.

One concern is that export markets will begin to use more trade barriers.

Tran Thi Mieng, deputy head of MARD's Department of Agro-Forestry-Fishery Product Processing, Trading and Salt Industry, said under Viet Nam's World Trade Organisation's commitment, this year agricultural encouragement subsidies were allowed, which gave Viet Nam a price advantage.

But subsidies and other forms of protectionism would end next year under Viet Nam's WTO trade commitments, she said.

Minister Cao Duc Phat said despite this year's tangible achievements, 2011 would be a tough year for the agriculture sector as natural disasters posed a large threat to the whole sector.

He said the target for next year's export turnover would be only $19 billion, a decrease of $15 million.

Phat said to accomplish the targets, the agriculture sector would invest more in scientific research to create a closer bond between scientists and farmers and promote more effective land planning.

Deputy Prime Minister Nguyen Sinh Hung said development strategies needed to reflect the current situation, including taking into account the impacts of climate change. He also asked the sector to push for restructuring so that technological advances continued to meet the needs of the market.

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