‘Blowing up’ durian prices breaks the entire link chain

Bài liên quan

'Confusion' when dealing prices for durians at the garden

At a recent conference to connect product consumption hosted by the Dak Lak Durian Association, export businesses warned that traders setting prices higher than the real product value will affect the industry. Farmers, businesses and local authorities need to solidify linkage to build a Vietnamese durian brand.

Protect the link chain

According to Ngo Tuong Vy, General Director of Chanh Thu Export and Import Fruit Co., Ltd., the current situation is that farmers return the deposit of a company when the latter sets a higher price. The cancellation of contracts has affected the reputation as well as the economic and financial situation of the business side.

“The price has been fixed at VND 60,000 - 65,000/kg before, and farmers have already made a lot of profit from that. The fact that farmers cancel deposits because of their greed, not following the principle of association," said the General Director of Chanh Thu.

General Director Vy stated a problem that the industry does not have a price rule and no legal binding in the association. “Farmers and cooperatives need to calmly rethink their course of actions because there is no guarantee that the price would still be as high as it is today when the gardens enter harvest.”

The price locked by traders at the garden is currently over VND 80,000/kg, and companies in reality can not handle such a high price. Even if some of them come up to purchase, the grade I product must be calculated at a price rate as per the contract signed with their customer. Unlike traders who can hold the garden and refuse to cut the fruits or lower that price rate after closing the deal, businesses cannot do that because it will greatly damage their reputation, making it very difficult for them to purchase and export durians.

According to Le Anh Trung, Vice Chairman of the Dak Lak Durian Association, the current situation of price inflation will leave consequences which lead to the destruction of the production - consumption chain. Businesses that wish to establish a real linkage will soon lose trust in farmers, making it difficult to control synchronous processes within the cooperative structure.

To avoid future conflicts of interest, the Dak Lak Durian Association gives some recommendations concerning the implementation of commercial contracts: Farmers and cooperatives, when signing contracts, need to carefully examine and evaluate the capacity of exporting enterprises: Where their packing facility is, how big the production scale is, and particularly whether they are qualified as per the General Administration of Customs China’s requirements and ready for direct export. Priorities should also be given to businesses that are eligible for local packaging.

Enhance the product quality

According to General Director Vy, the output of durian harvested in Dak Lak is less than 40% of the area. In the next 3 years, the area for harvesting will double or triple. Therefore, the local government as well as the Dak Lak Durian Association need to come up with long-term solutions.

“We shall identify the value of durian together. There are 3 main factors, which are to comply with the standards of the importing countries, invest in technology and planting area standards, and it must be done by farmers, build trust between businesses and farmers, and make a difference in business activities. Without differences, the durian industry cannot stand alongside its strong competitors like Thailand in the world market," said the General Director of Chanh Thu.

Nguyen Thi Thanh Thu, Chairman of Bagico Joint Stock Company mentioned learning from the durian industry of Thailand. For durian fruit to be of high quality and highly evaluated by importing countries, it is necessary to plan durian gardens in a scientific manner.

“Most of Thailand's export durian gardens are relatively large, even the smallest is 10 - 20 ha. The friend country has scientifically planned durian gardens and convenient routes to transport. In Thailand, farmers build a pre-processing and packaging workshop in the garden. This is very important. Building facilities to collect and pack products rìght in the garden while also planning a shopping center with convenient traffic will help reduce logistics costs and property damage”.

According to a business owner purchasing and exporting durian in Dak Lak, there is currently a link between businesses, cooperatives, farmers and the government, but it is a loose link. To ensure long-term development, all levels of management and associations should pay more attention to the durian industry, have policies to facilitate businesses’ product purchase process, commit to accompanying farmers in calculating tax rates and conditions of production ground, and provide support in terms inputs prices for the next crops.