The Department of Economic Cooperation and Rural Development said that raw production only creates 15%-20% of value, the remaining value lies in processing, trading, etc. Therefore, circular production and deep processing are inevitable directions. However, to increase the economic value of agricultural products of cooperatives, in addition to land, there are also issues of capital and the level of application of science and technology of cooperative members...
Increasing the value of agricultural products
These days, the production atmosphere at the factory of Tan Thanh Agricultural Cooperative, Nong Thuong Commune, Bac Kan City is very bustling. From a small facility in the past, Tan Thanh has now become one of the leading cooperatives in building a chain of linkages and deep processing of products from turmeric.
Director of the Cooperative Nguyen Thi Hong Minh said Nong Thuong Commune in particular and Bac Kan Province in general have a large area of glutinous turmeric, but many farmers have difficulty in consuming it because there is no turmeric processing factory. After researching and realizing that turmeric products are very good for health, I established Tan Thanh Agricultural Cooperative. At the same time, I learned about the turmeric processing process and purchased machinery. The products have been well received by consumers, but the quantity is still small because the cooperative lacks resources to invest in modern machinery.
To solve capital problems for Tan Thanh Cooperative in particular and all agricultural cooperatives in the province in general, the People's Committee of Bac Kan province has implemented support for cooperatives with capital from the APIF Fund (Agricultural Business Promotion Investment Fund). Receiving support of more than 1.6 billion VND for the support period from 2019 to 2020, Tan Thanh has purchased equipment and production machinery.
Thanks to that, from the initial 10 products, the cooperative now has 23 products, of which two products have achieved 4-star OCOP certification and one set of products has achieved the National Outstanding Rural Industry certification. In addition, the cooperative's raw material area has met organic standards and has been granted a growing area code. This result has contributed to increasing the income of many turmeric-growing households.
Embarking on deep processing to increase product value is also the direction of Phu Ngai Agricultural Cooperative, Phuoc Ngai Commune, Ba Tri District, Ben Tre Province. Currently, the Cooperative is recognized as one of the five key cooperatives in Ben Tre Province, successfully transforming from selling raw rice products to businesses to specialized products and directly selling rice products to consumers, bringing high economic efficiency.
Established in 2016, Phu Ngai Agricultural Cooperative initially had 22 members with a capital contribution of only 6.3 million VND. The Cooperative's activities mainly grew rice and crops, but the output was unstable. By 2019, after the Cooperative was consolidated, the number of members had increased to 101 with a capital contribution of more than 500 million VND, producing about 100 hectares of rice and 22 hectares of vegetables.
Of which, 40 hectares produced organic rice with contracts signed with businesses. From 2023, the Cooperative will switch to producing specialty rice with ST25 variety according to a closed process, milling, packaging, vacuuming, supplying directly to consumers, competitive prices, bringing great economic efficiency.
Farmer Ho Van Truong, a member who contributed 10 million VND to Phu Ngai Agricultural Cooperative, is cultivating 8 hectares of rice and said that he is very excited when the profit has increased more than twice compared to the traditional method before.
According to Truong, when participating in organic rice production, the Cooperative supports 100% of rice seeds, 50% of fertilizer costs, and pesticides throughout the crop season. Other services such as: Hiring workers for planting are also reduced by 50% and consuming the products made, so the profits of the Cooperative members are much higher.
Chairman of the Board of Directors and Director of Phu Ngai Agricultural Cooperative Mai Van Khang said: “Currently, the Cooperative buys rice from members at a price of 10,500 VND/kg and supports low-cost agricultural services, so people's profits are much higher than before. Especially since investing in packaging and vacuuming machines to sell rice directly to consumers, the Cooperative has increased profits by about 4,000 VND/kg. In the 2023 rice crop alone, the Cooperative's output reached 45 tonnes of rice, not enough to sell to the market despite the very competitive price”.
The success of cooperatives such as Tan Thanh (Bac Kan) and Phu Ngai (Ben Tre)... in the strategy of developing specialised processing shows that this is the right and correct direction for agricultural cooperatives today.
Supporting cooperatives to promote deep processing
The Department of Cooperative Economics and Rural Development said that in the two years of 2022-2023, the Department has allocated a budget of 3.5 billion VND and coordinated with institutes and schools under the Ministry of Agriculture and Rural Development to organise 21 training courses with 1,150 trainees on production and business development training, and participation in linkages for managers and members to improve the management and business capacity of cooperatives.
At the same time, it will advise and propose to localities to support funding and infrastructure for agricultural cooperatives to best implement deep processing of agricultural products. Thereby, maximising the goal of increasing value per unit of cultivation.
To support the agricultural sector, the Government has also issued Decree No. 113/2024/ND-CP stipulating many State policies on supporting the development of cooperatives, cooperatives, and cooperative unions, including policies to support human resource development; policies to support the application of science and technology, innovation and digital transformation; policies to support market access and research; policies to support investment in developing infrastructure and equipment; policies to support financial consulting and risk assessment; policies to support activities in the agricultural sector...
This is considered a solution to help cooperatives improve their deep processing capacity. Vice Chairman of the Ben Tre Province Cooperative Union Le Hoang Thanh added that to support cooperatives, the locality is implementing the project on developing OCOP products for cooperatives in Ben Tre province, aiming to enhance the capacity to develop collective economy and implement the OCOP programme for cooperatives.
In particular, the goal is to build a model for developing collective economic cooperatives; build 20 new OCOP products for 20 cooperatives; upgrade 7 existing OCOP products of cooperatives... At the same time, the locality continues to support cooperatives in building brands, product labels, product packaging for agricultural cooperatives, support cooperatives in designing models, registering product labels to increase competitiveness in the market.
Bac Kan province has also determined that in the period of 2022-2025, it will support human resources for 100 cooperatives in need of workers with college degrees or higher, the support level is 1.5 times the regional minimum wage, the maximum support period is 36 months (until December 31, 2025).
In parallel with human resource support, Bac Kan continues to select and invest in supporting cooperatives with potential production and business plans associated with the value chain. From 2022-2024, the province will invest more than 31 billion VND to support the construction of production infrastructure for 14 key cooperatives in the province.
