Vietnamese fresh fruit segment loses the domestic market

Nearly 70% of the land in the country is suitable for growing produce, and more than half of the population works in the agricultural sector. However, in order for the country to become a global player in the fresh fruit market, they must meet international food safety standards.

The simple fact is that the Vietnam government currently struggles to administer and enforce food safety regulations, and fresh fruit exports are often rejected by other countries due to food safety and quality concerns.

Food safety issues arise at the growing, harvesting, processing and packaging stages, says the Association, noting that without a robust system in place to identify when and where the problems are introduced, it will be virtually impossible for the segment to sustainably increase its exports.

The segment needs to get back to the basics and come to the realization that the overarching objective is to provide better produce for local market consumers first and foremost and put the international market on the back burner.

There is no question that training is needed across the spectrum of workers in the segment to teach them on the importance of VietGap good agricultural practices and how to apply them in actual practice.

Education is also needed in order that the workers understand the increased market potential those practices will encourage if all actors in the segment commit to adopt them, says the Association.

The plain facts are that the fruit segment has lost the domestic market as evidenced by the volume of imported fruit that is on supermarket shelves throughout the country despite the fact the selling prices are five times as high.

In many supermarkets in Hanoi, for example, domestic fruit is nowhere to be found as it has been replaced by kiwi from New Zealand, grapes from Australia and apples from the US.

Local consumers are turning away from fruit grown in Vietnam because they are concerned about its safety. Grocers in turn are stocking foreign fruit in response to consumer demand.

Vu Vinh Phuc, chair of the Hanoi Association of Supermarkets, recently said that the local fruit segment is suffering from the lack of food safety certifications as well as its poor packaging and labelling.

Vietnamese farmers and producers not only fail to comply with VietGap as well as the government’s laws and regulations on packaging and labelling—they fail to meet with local consumer demand.

Supermarkets require producers to meet certain process standards and food safety requirements before purchasing their produce because that is what the Vietnamese consumers demand.

Fruit that are misshapen or discoloured are rejected by the supermarkets because Vietnamese consumers will not purchase them. Nor do local consumers want poorly packaged fruit, without a label that has not been cold stored.

The fact of the matter is that the domestic sector has lost the fresh fruit segment because actors in the industry do not know how to compete and literally think of competition only in terms of price.

And they regularly lower their quality to lower their price, which in their minds is the only way they know how to compete.

They fail to understand that producing a quality and safe product on a timely and consistent basis can command a higher price in the marketplace and lead to increased earnings and a better quality of life.

Food safety is the major issue in Vietnam, says Leandro Rossi of VECO Vietnam, an NGO focused on sustainable agriculture. While steps have been taken to improve safety, Vietnamese simply do not focus on quality.

Most Vietnamese farmers do not know which pesticides they are buying and are given no guidance on how to apply them to crops, says Rossi, adding that most are not event aware of the health hazards the chemicals present.

The fresh fruit segment has lost the domestic market because consumers feel they can’t trust the produce anymore.