Farm produce prices slump as COVID-19 hits exports

The suspension of trade in aquatic and agriculture products at some northern border gates with China as a measure against the novel coronavirus (COVID-19) has caused a demand-supply imbalance in the market.

The fisheries sector is facing a number of difficulties because of the epidemic.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), aquatic product exports to China, where COVID-19 is raging, were down 45 percent in January to 51.5 million USD.

VASEP Secretary General Truong Dinh Hoe said exports were down from the same period last year partly because January coincided with the Lunar New Year holidays which interrupted exports for 10 days.

The outbreak in China has also had a serious impact on several other industries in Vietnam, including transport, tourism and retail.

Last year, China was the largest importer of Vietnamese tra fish, buying 622.7 million USD worth, or 31 percent of the country’s total exports. Many processors continue to see China as a strategic market this year thanks to steady export growth and the good prices and diverse segments in that country.

So any interruption in Vietnam-China trade such as the current one hits the tra fish segment hard, he said.

Lobster exports to China too have been hit, causing prices to drop by nearly half in the local market.

Tran Thi Trang, a seafood restaurant owner in HCM City, said lobster prices are now around 700,000 VND (30.2 USD) per kilogram, down 400,000-500,000 VND (17.3-21.5 USD).

Thanks to the sharp price drop, her restaurant sells more than one tonne a week, including 300-400kg during weekends, she said.

Alaska lobster and king crab prices have dropped by 30-50 percent.

The consumption of that seafood is increasing sharply but cannot pick up the slack caused by the slump in exports.

In this context, VASEP has advised member businesses to keep abreast of information from Chinese partners to dispatch their consignments as soon as customs clearance is permitted to minimize preservation and storage costs.

They have also been told to rework farming and processing plans to avoid excessive supply.

VASEP plans to propose that the Ministry of Agriculture and Rural Development and the Government should issue policies to support affected businesses and farming households such as by reducing loan interest rates and extending payment deadlines.

COVID-19 has caused problems to the agricultural sector, which is thought to be the worst affected, especially dragon fruit, watermelon and rice exports.

But it is also an opportunity to change production and business methods to adapt to new challenges and difficulties.

Minister of Agriculture and Rural Development Nguyen Xuan Cuong said it was necessary to develop both short- and long-term scenarios.

“In order to take advantage of opportunities, it is necessary to develop large-scale production and co-operation chains to find other directions for agricultural output.”

Deputy General Director of the Central Group Nguyen Thi Phuong said her company was buying agricultural products from farmers in the provinces of Binh Thuan, Gia Lai, Khanh Hoa, Long An, and Tien Giang.

“This support program is being carried out at all 37 Big C and GO! Market supermarkets nation-wide until the situation is controlled. We expect to buy 80 tonnes of dragon fruit and watermelon per day.”

At Big C and GO! in the north, watermelon is sold at 6,200 VND per kilogram and dragon fruit at 15,500 VND. In the south, they are sold at 4,900 VND and 10,900 VND. These prices are around a third of that on normal days.

The demand for agricultural products was very high in her supermarket chain, Phuong said.

It had asked MARD for details of agricultural produce which cannot be exported so that it could set up proper marketing programs in the domestic market, she added.