After more than 1 year of implementing the 1 million hectares of high-quality rice project, the linkage of the actors participating in the chain is not sustainable; especially the linkage with banks to help rice enterprises overcome difficulties in capital sources.
Need to strengthen linkages in the Project of 1 million hectares of high-quality rice
Recently, the Central Government and ministries have invited businesses to participate in the 1 million hectares of high-quality rice project. Binh Dien Fertilizer Joint Stock Company was assigned to participate in 2 locations, Dong Thap and Can Tho.
Mr. Phan Van Tam - Deputy General Director of Binh Dien Company said that the unit brings the product to participate in the technical solution of buried fertilization to help farmers reduce the amount of fertilizer. Binh Dien will continue to invest in technology to improve products and develop new suitable products.
Applying mechanized sowing in the 1 million hectare high-quality rice project. Photo: Vietrisa
According to Mr. Tam, the Project not only helps farmers but also helps businesses. From the linkage programs in the Project, businesses have the opportunity to bring products to farmers, serving sustainable agricultural production, aiming for green growth as proposed by the Government.
Mr. Tam also said that many businesses are eager for the Project to provide standard procedures and framework regulations so that they can participate in the linkage; creating a strong chain from input to output.
According to Dr. Tran Minh Hai - Vice President of the Vietnam Rice Industry Association (Vietrisa), the change in farmers' awareness, shifting from traditional farming to sustainable methods is the most outstanding success of the Project to date. However, the connectivity in the Project still has many problems.
The value chain is a collective action, if just one agent is not connected, the whole chain will break down. According to Dr. Hai, the decrease in rice prices in the past month has partly shown that collective actions in the rice chain have not connected the parties.
Finding an effective model to solve capital sources for rice enterprises
According to the Project, by 2025, the linkage between enterprises and cooperatives and cooperatives will reach 100%. To achieve this, cooperatives need to improve their service capacity to attract enterprises.
The model implemented in Kien Giang province focuses on building large raw material areas of 300-500 hectares. Then, cooperatives and community agricultural extension will connect businesses with actors in the chain, from harvesters, mills, rice boats...
The enterprise only needs to purchase the rice and is willing to pay a higher price than elsewhere. All the rest depends on the service capacity of the cooperative and the community group, Dr. Hai gave an example.
Need capital mechanism for enterprises in the Project of 1 million hectares of high-quality rice
In the industry chain, capital for rice purchasing enterprises has been a long-standing difficulty. According to Dr. Hai, banks currently have excess capital while enterprises are in dire need of capital. In particular, the 1 million hectare ecosystem needs a different mechanism and banks need to share more with enterprises.
For example, to mechanize, the cooperative needs a rice seeding machine worth about 500 million VND. But it will take a lot of time for the cooperative to borrow capital. Meanwhile, each individual is entitled to borrow 100 million VND on credit. If the bank lends in the form of personal credit, then 50 people working together, each person only needs to borrow 10 million VND to have a rice seeding machine.
Tien Thuan Agricultural and Service Cooperative in Vinh Thanh District was selected to pilot the model in Can Tho. Photo: Nguyen Vy
Similarly, businesses cannot borrow capital on mortgage. Businesses that want to build a chain must invest in silos to store rice and rice mills. This investment is medium and long-term capital. Dr. Hai said that banks only allow businesses to access short-term capital. "Using short-term capital to invest in medium and long-term is full of risks, no different from a trap," Dr. Hai said.
Also emphasizing the role of linkage, Mr. Cao Thang Binh, senior agricultural expert of the World Bank in Vietnam (a unit accompanying the Project) said that this issue is not new but the way of doing it has not had much development progress.
The linkage of rice production chain in the Mekong Delta is not high. If the project of 1 million hectares of high-quality rice is implemented synchronously, businesses will be exhausted in purchasing due to lack of capital.
To implement the linkage chain, rice enterprises need capital to invest in silos, rice factories... Illustration photo: Nguyen Vy
Currently, businesses only implement contracts within their limited financial capacity. However, when implementing contracts on large areas of 5,000-10,000 hectares, there is not enough capital to do so, which has a negative impact on farmers. If farmers try to follow the project but cannot sell at a good price, it sometimes backfires and farmers return to their old farming methods.
According to Mr. Binh, businesses are eager to borrow capital. Commercial banks are also eager to lend. However, the two sides have not been able to meet due to problems with loan conditions.
"For example, the form of borrowing by mortgaging assets, every few months the book is put in, every few months the book is taken out; this method cannot be implemented on the 1 million hectare area of the Project," said Mr. Binh.
Many businesses need capital support to purchase rice from farmers. Photo: Nguyen Vy
According to the WB representative, there is no shortage of money in commercial banks. And with the current sluggish real estate market, banks also need new partners. The agricultural and rural areas can help banks make money.
Therefore, there needs to be a more effective lending mechanism for rice enterprises. And commercial banks also need a healthy financial model to minimize risks. Mr. Binh shared that the World Bank is actively working to improve lending efficiency.
Associate Professor Dr. Bui Ba Bong - Chairman of VIETRISA said that VIETRISA Association will accompany the Ministry of Agriculture and Environment to implement the 1 million hectare Project; contributing to spreading the Project to other key rice production areas across the country.
In 2025, VIETRISA will continue to promote linkages in the rice value chain, through piloting linkage models such as: Connecting traders to the linkage system of farmers, cooperatives with enterprises; alliances of enterprises (input, service, output) in linkages with farmers, cooperatives; and linking farmer groups in borrowing capital to buy machinery and equipment.
Source: https://danviet.vn/chuyen-gia-hien-ke-cac-giai-phap-giai-quyet-nguon-von-cho-doanh-nghiep-san-xuat-xuat-khau-lua-gao-20250309155653504.htm
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