Organic farmers begin to reap the fruits of their work
Pham Thai Binh, CEO of Trung An Hi-Tech Farming Jsc in the Mekong Delta city of Can Tho, decided to expand his organic farm 15 fold to 1,500 hectares this year after seeing a surge in demand.
“We did not grow a lot of organic rice before because of the low number of buyers, but demand has now caught up with our 100 hectares of output and so we need to expand.”
Though many people say organic rice is expensive, there are those who prioritize health over money, and these are his target customers, he said.
Echoing him, Nguyen Lam Vien, chairman of HCMC dry fruit producer Vinamit, said 2020 is the year of organic farming in Vietnam because the Covid-19 pandemic has boosted demand for healthy products.
“Organic farming startups that began operations in 2018 and 2019 have reaped their rewards this year, with some reporting demand exceeding supply.”
The rising popularity of organic produce comes amid the increasing use of plant protection products. Vietnam has been using around 100,000 tons of plant protection products a year since 2015, 10 times the amount used in the 1960-90 period, according to the Vietnam Plant Protection Association.
In the last few years many entrepreneurs have begun to invest in organic farming to tap into a small but growing market of consumers who are concerned about their health.
Their enterprise and hard work have paid off. Nguyen Thi Quynh Vien, who in 2011 established a startup to cultivate a 0.5-hectare organic farm, said her company stopped burning through cash in 2018 and has since received many partnership offers.
The founder of Happy Vegi, which has 21 outlets nationwide, added: “We are building two digital farming areas managed via smartphone applications. I believe that growing vegetables without using chemicals is profitable.”
Some companies are optimistic about the possibility of exporting their organic products, especially with the EU-Vietnam Free Trade Agreement coming into effect recently.
Nguyen Ngoc Huong, founder of Thien Nhien Viet, a producer of organic vegetable powder that recently exported nearly 20,000 units to the Netherlands, said: “European buyers love organic products. They buy all of what we sell.”
But industry insiders said the organic farming industry in Vietnam still has a long way to go and companies need to invest more in perfecting their business model.
Tran Phong Lan, CEO of Seagull Agriculture Development Corp in the southern Hau Giang Province, has invested nearly VND40 billion ($1.7 million) in organic farming since 2013, and said more investment is on the cards.
“Growing organic products is hard, selling them is even harder. In the last three years I have spent VND30 billion to establish a distribution system and market the brand.”
Vien of Vinamit agreed that distributing the products from farm to table is not easy. In 2017 and 2018, he had to personally go to supermarkets to convince them to put up his products on their shelves, he said.
“The cost of educating customers is the same as or even higher than the product’s value, but without that cost we won’t be able to sell.”
Each sales outlet requires a person to counsel customers and let them try the products, he said.
Being in this business therefore requires perseverance and deep pockets, and Lam said he has seen many young people fail to survive.
“They need time to gain experience, raise money, and have a clear vision of the market.”
But there is a future. Binh said modern technology has aided organic farming and helped reduce risks.
His decision to grow 1,500 hectares of organic rice, if successful, could halve prices to VND20,000 per kilogram, he said.
“Surely organic farming is profitable.”
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