-

For a great passion for investment in agriculture of the Companies (Period 1)

03:01 12/04/2019

Restructuring the Agriculture sector, especially in the context of the current integration, requires the central role and decision of enterprises. With the strength of capital and technology, the enterprises will create a chain of agricultural products, ensuring a comprehensive and sustainable development of agriculture.

2018 was the year of loss for the farmers planting chili pepper.

 However, the number of enterprises investing in the agricultural sector of the province is only at the "modest" level, needing the support of the State, but the prerequisite condition is a breakthrough in policy for the enterprises.

Period 1: The chorus of “rescue”

The farmers lacked information of the market, the production followed the old method and the immediately expensive things without anticipating the oversupply of the market that was the main reason why the farmers' products always needed to be "rescued". In the chorus of "good crop, devaluation", there was always no shadow of the "conductor" of enterprises in coordinating to consume the products.

Chili pepper was a traditional and key plant in the winter-spring crop of Quynh Phu district with the annual area of ​​nearly 1,000 ha. Being affectionate with Quynh Phu district's land for decades, the chili pepper plant had higher economic value than other winter crops and had much higher economic value than rice cultivation when chili price was at high rate. As in the winter crop of 2018, many farmers had to cut down trees early due to the low price. Many farmers said that the first season of chili pepper was also priced at 15,000 - 20,000 VND/kg, the more it came into the main season, the lower the price was, sometimes it was priced at 3,000 - 5,000 VND/kg. The investment capital for chili pepper cultivation at least cost 4-5 million VND/0.036 ha. Everyone hoped, with high quality and productivity, it will make a quick profit, but sadly, the price of fresh chili pepper remains too low in the whole crop, compared to the spent expense, many chili pepper planters suffered from heavy losses.  Merchants coerced, bought moderately, the revenue was not enough to cover the fertilizer expense, irrigation, so many fields of ripe chili pepper were not collected by the farmers. According to some merchants, the export market of chili pepper plants was mainly China in small quota manner, but because the "demand" is little, the "supply" is too much in this year so most of chili pepper were sold to establishments making chili sauce, meanwhile the phrase of " agricultural product rescue" seems to be the exception for chili pepper because of its small demand and very low consumption.

2017 was an unforgettable year when the deflation crisis caused heavy losses to the porker farmers. From the end of 2015 to the beginning of 2016, the price of porker increased very strongly, but from the half-end  of 2016 to the end of 2017, it was the period when porker raising became distressed. The strong increase in porker prices at the end of 2015 to the first-half of 2016 created a whirlwind of investment that caused sudden increase in porker raising, including Thai Binh province. Occupying about 80% of the total production of cattle and poultry meat, with an annual volume of 184,000 - 200,000 tons, pork was considered a major commodity in the province's breeding while the breeding in pattern of small-sized and single farming household still occupied a big ratio. The input prices were high, the production costs were also high while the selling price and product consumption market was unstable. Besides, the linkage in breeding production was still poor, there was no active participation of enterprises, especially those processing, slaughtering and consuming the breeding products, so the "output" for breeding was unstable.

Ms. Pham Thi Gai at Vu Hoi commune (Vu Thu) said: In early 2017, the porker breeding households like me were afflicted, the price was low but there was no trader buying our products, at that time every porker lost from 1.5 to 2 million VND, for the households self-propagating in breeding facilities, they lost at least 1 million VND/head. In order to cope with difficulties in porker breeding, we reduced the porker’s rations, fed them moderately, used available ingredients to mix with food to reduce the price of breeding or size of herd, we even slaughtered and sold by ourselves to offset the loss. Many households were in debt, even many of them had to leave from the locality to work in another place to earn money to repay their debts.

The dismal underpricing of chili pepper and porker were just two of many agricultural products that often suffered from the situation of good crop but devaluation. It showed that the main reason was due to the lack of market information for farmers to determine what to plant, what to raise, and how many it is. The farmers produced in a manner of everyone for themselves, when the price increased, it was massively raised and planted and when it was underpriced, it was cut down and discarded to transfer to other varieties. Therefore, in order to eliminate the situation of "good crop, devaluation", "good price, poor crop", in addition to production orientation and improvement of product quality, an essential requirement was to form the production chains, the farmers linked together into groups and teams such as cooperative groups, cooperatives and this link chain must be led by the business.

 Thai Binh must strive to become a populous and rich province based on smart agriculture, organic agriculture, clean agriculture, high quality agriculture and service industry for agriculture, contributing to the formation of a new appearance for Vietnamese agriculture and a picture of Vietnamese rural area in the next decade.

(Statement by the Prime Minister Nguyen Xuan Phuc at the conference on investment promotion in agriculture and rural area in Thai Binh province on 8/4/2017).

 

Mr. Vu Van Hanh, Vice Chairman of Hung Ha District People's Committee

In order to seek for a stable output for the farmers, over the past time, along with the completion of new rural construction at the localities in the district, Hung Ha also has its own support mechanism of 300,000 VND/ha to encourage the enterprises, collectives and individuals to rent or borrow land from 2 hectares or more for agricultural production and also assign the agricultural service & production and business cooperatives to act as a bridge between enterprises and farmers in the district in production and consumption of agricultural products. Besides, Hung Ha district also issued a mechanism to support businesses and individuals to invest in development of caged fish breeding model in accordance with the plan with the amount of 10 million VND/cage. Therefore, up to now, Hung Ha district has attracted 15 enterprises to join in associated agricultural production with a total area of ​​nearly 1,500ha.

Mr. Pham Thanh Nhuong, Director of Provincial Livestock Production and Animal Health Department

In order to develop livestock production in series, ensure disease safety, it is necessary to build a product brand and solve the problem of product output, this must have the engagement of enterprises, especially the enterprises operating in the field of purchasing, slaughtering and processing the livestock products. Although, the investment attraction of enterprises in the past time was promoted but still not effectively enough to attract and induce the potential enterprises in this field.

Mr. Dao Van Ky, Quynh Hai commune, Quynh Phu district

Although the chili plant has been grown in Quynh Phu for more than 30 years, there were no crops we felt secure about the product output. Because it was sold to private traders, we enjoyed the profit for its high price. The agricultural cooperatives used to sign contracts with companies and enterprises to buy the farmers’ products but due to strict requirements on quality and models of the enterprises as well as the difference of purchasing price compared to that of the outside traders, most people "broke the deal". 2018 was a year the chili’s price was at the lowest, such status last nearly the whole season, so many households removed the piles, root up in spite of its profuse harvest.