Selling Vietnamese farm produce to Thailand’s supermarkets
As announced by MM Mega Market Vietnam, 100 tonnes of Vietnamese agricultural products, including yellow sweet potato, purple sweet potato, dragon fruit, dried fruit, and rice paper, have recently been exported to a system of 700 Big C supermarkets in Thailand. This is the first order of Vietnamese farm produce that has been successfully exported to Thailand’s supermarket chains since MM Mega Market was granted an export license in late 2017.
In order to achieve this result, MM Mega Market organised many programmes to introduce and advertise Vietnamese products to Thai consumers, before carrying out direct export activities. Thai consumers have shown a deep interest in Vietnamese commodities, especially agro-fishery products such as Da Lat avocado, dragon fruit, Japanese sweet potato, and basa fish. Vietnam’s farm produce has also attracted customers thanks to their advantages in terms of quality, sources of products, and competitive prices. For example, Japanese sweet potato is of high quality and very sweet, while it is sold at a much better price than the other sweet potato varieties of the same type imported from Japan. Another advantage of Vietnamese agricultural products is the diversity of topography and climate, such as vegetables from Da Lat city, aquatic products from Can Tho city, or fruits from Ben Tre province. This helps the collectors to find many sources of products in just one country.
Together with MM Mega Market, Big C Vietnam (Central Group) is also actively implementing programmes in order to promote the export of Vietnamese goods to the Big C supermarket chain in Thailand. The Vietnam Goods Week has been held annually in Bangkok over the last three years, with the 2018 event scheduled for August 22-26.
In the Central Group system in Vietnam, there is a department called “Central Global Sourcing Vietnam”, which is responsible for purchasing and exporting Vietnamese goods. The department fosters partnerships with 200 Vietnamese suppliers and exports Vietnamese farm produce to a number of markets, such as Thailand, France, Italy, the United States, and the African region. It not only performs the task of collecting products, but also orientates farmers’ production so that their products will be accepted in the import markets. Le Thi Mai Linh, Executive Vice President of Public Relations and Corporate Social Responsibility Department at Central Group Vietnam, said that the 2018 Vietnam Goods Week will continue to connect the collection department with Thai retailers, focusing on the group of agricultural products, towards increasing the export revenue of Vietnamese goods to the Big C supermarket chain in Thailand. This activity is expected to help Vietnamese agricultural products become increasingly known to native consumers.
Contributing to balancing trade
In recent years, Vietnam’s trade deficit with Thailand has seen constant growth. According to the Ministry of Industry and Trade (MOIT), the two-way trade revenue in 2017 reached approximately US$15.28 billion, up nearly 22% compared with 2016. Vietnam ran a trade deficit of around US$5.71 billion with Thailand, up 10.7% annually. In the first four months of 2018, with a trade deficit at US$ 1.75 billion, Thailand continued to be Vietnam’s largest trade deficit market in the Southeast Asian region.
The main cause for Vietnam’s trade deficit over recent years is that Vietnam mainly imported high-value items, such as complete cars, machinery parts, and household appliances from Thailand, while only exporting goods of lower value, such as agro-fishery products, minerals, and textiles. Furthermore, despite the similarity in terms of goods structure, the competitiveness of Vietnamese commodities remains lower than that of Thai goods, thus resulting in limited export revenue. Therefore, the successful exports through the supermarket system are expected to help Vietnamese goods to improve competitiveness, reduce trade deficit and gradually balance the trade between the two countries.
In its efforts to support the export of Vietnamese goods to Thailand, the MOIT will continue to organise the Vietnam Goods Week programmes in Thailand in the future. In addition, the ministry will actively negotiate with the Thai side on opening the door to more fruits and vegetables of Vietnamese origin, while encouraging businesses to organise trade promotion activities in Thailand by themselves, thereby contributing to boosting exports and mitigating the trade deficit pressure.
MM Mega Market importing hundreds of tonnes of agricultural products from Vietnam shows that farm produce are an item of strength with numerous opportunities to be exported to Thailand, helping to curb the trade deficit momentum from this market. However, Le Quoc Phuong, former Deputy Director of the Industry and Trade Information Centre (under the MOIT), noted that Thailand is a country with a very developed agricultural sector and Thai agricultural products have better quality and are more competitive than Vietnamese goods. Therefore, in order to gradually reduce the trade deficit, towards balanced trade, the only and important solution is to improve the competitiveness of Vietnamese agricultural products in terms of quality, price and safety.
