New status of Vietnamese agricultural products in the US

Vietnam - US agricultural cooperation has made great progress since the establishment of diplomatic relations in 1995. From ranking 95th among US partners, Vietnam has now become the 8th largest trading partner of the US, with bilateral trade turnover in 2022 of nearly 123 billion USD. The US is Vietnam's largest export market, exceeding 100 billion USD at the end of 2023.

According to experts, Americans' needs to enjoy high-quality agricultural products and fruits from the tropics are rising, and American consumers increasingly prefer Vietnamese specialty fruits such as fresh lychees, dragon fruit, mango. Recently, grapefruit has been officially allowed to be imported by the US, giving Vietnam 7 types of fresh fruit exported to the US.

American consumers increasingly prefer Vietnamese specialty fruits such as fresh lychees, dragon fruit, mango

At a meeting with a business delegation of the US - ASEAN Business Council (USABC) to seek investment opportunities in Vietnam, Prime Minister Pham Minh Chinh said that in the field of agriculture, Vietnam continues to research, promulgate specific, long-term, attractive incentive policies and suggest that American businesses should be more interested in investing in this field.

Prime Minister Pham Minh Chinh welcomed US - ASEAN Business Council and US businesses - Photo: VGP/Nhat Bac

Mr. Jason Hafemeiser, acts as Deputy Secretary of the US Department of Agriculture, has repeatedly affirmed that the US always considers Vietnam one of its leading partners in agriculture. The two countries' agriculture is complementary to each other for mutual development, accordingly, Vietnam's openness to fruit is being actively promoted.

Many opportunities for Vietnamese agricultural products

According to Ms. Nguyen Thi Kim Huyen (Jolie Nguyen), CEO of LNS Group, during the "real battle" of promoting and distributing products in the US, she realized that this is still a potential country with great opportunities, especially in agriculture for Vietnamese products.

Commenting on opportunities for Vietnamese businesses targeting a market of more than 340 million people, Ms. Jolie Nguyen said that with a large number of overseas Vietnamese, along with many Asian and Vietnamese supermarkets system have created a lot of rooms for Vietnam original products.

Besides, the Latin American community is gradually having similar consumption habits as Vietnamese, they love Vietnamese products including fruits, seafood,... with unique characteristics and difficult to find in other countries, many typical agricultural products such as coffee, pepper... but America does not have the strength to produce.

However, according to Ms. Jolie Nguyen, Vietnamese businesses still have to face challenges from this most targeted market. For example, post-Covid-19 shipping rates are increasing, pushing up the prices of Vietnamese goods and products, and causing competitive pressure on prices compared to countries in the South American region.

In addition, the business scale is still small, mainly producing raw materials in small quantities, leading to long-term response and hardly ensuring the supply of quality products. At the same time, regulations on product censorship and packaging in the US market are relatively strict, and requiring businesses to strictly comply.

“The US is a large and open market, to export products to this market is both "difficult" but also "easy". Businesses need to proactively take advantage and seize opportunities by clearly understanding product censorship processes and regulations, and when opportunities come, be careful and maintain reputation in product quality", Ms. Jolie Nguyen adds.

Export prices need to be more competitive

Production costs of Vietnam's agricultural industry are increasing due to pressure from gasoline prices and the supply chain, especially investment in green production processes and emission reductions as requested by buyers from the US and EU also put Vietnamese businesses in a position of having to transform to respond and keep up.

Not to mention, with the remote geographical distance and high transportation costs, Vietnamese agricultural products exported to the US are struggling to find ways to minimize production costs to compete. Faced with price pressure, US businesses recommend that Vietnam needs to increase investment in preservation technology so that fresh fruit can travel by sea to the US, taking advantage of FTAs to have the best tariff incentives, allowing for more competitive goods.

In the long term, solutions to develop the "smart agriculture" model must be deployed, with the application of technology to improve productivity and minimize climate change effects.

However, with the soaring protectionism policies of other countries, Vietnamese exporters need to pay attention to anti-dumping investigations and keep records of exported goods. The US market is increasingly concerned about consumer safety issues, sustainable development, and combating climate change, and that will be the premise for setting up new standards related to the food chain supply and clean raw materials.

Souce: VnEconomy