With a population of over 100 million people, the domestic market can be considered a potential home for Vietnamese agricultural products to boost consumption. When exploiting this market area well, in addition to reducing transportation costs and increasing the value of goods, it also creates stability in output for many products, especially during times when the world market fluctuates, affecting export activities.
According to the Ministry of Agriculture and Rural Development, the country's annual rice output is about 43 million tons; vegetables about 19 million tons; fruits about 12 million tons; seafood more than 9 million tons... This is a large amount of goods, requiring rapid consumption during the main season.
Towards the domestic market
According to the Vietnam Association of Seafood Exporters and Producers (VASEP), in addition to boosting exports, many seafood businesses are looking to expand their market share in the domestic market. Specifically, Vinh Hoan Corporation has had many solutions to bring its products to domestic restaurants and supermarkets.
The company's revenue in the Vietnamese market in the first 6 months of 2024 reached VND 1,734 billion, an increase of 38% over the same period in 2023. Minh Phu Seafood Corporation is also focusing on developing the domestic market by signing a strategic cooperation agreement with Bach Hoa Xanh supermarket to sell export-standard shrimp products in a chain of nearly 1,700 retail stores, aiming to sell 3,000 tons of shrimp/year with a revenue of VND 500 billion in the domestic market because although it is a large-scale seafood production enterprise, currently the domestic market revenue of Minh Phu Group only accounts for less than 1% of total revenue.
According to VASEP statistics, the domestic market is one of the important market segments and brings positive revenue to businesses. Currently, VASEP also has a domestic consumption business club with 30 businesses. There are businesses whose revenue from the domestic market accounts for 30-50% of total sales.
VASEP General Secretary Truong Dinh Hoe said that paying close attention to the domestic market at the present time is an advantage for seafood businesses to achieve their goals in 2024. The reason is that shipping freight rates remain high, especially during the peak shipping season of the year, greatly affecting export activities. Not only are shipping rates increasing, but many businesses are also facing difficulties in booking ships or empty containers. Meanwhile, the seafood industry's specificity is that it requires refrigerated containers and transportation time is very important because it is related to product quality. Therefore, if the amount of goods sold in the domestic market can be increased, it will reduce the pressure on transportation costs that are weighing heavily on businesses.
Along with aquatic products, Vietnam's annual fruit and vegetable output is also very large, especially during the peak harvest season, so the domestic market is an important consumption channel to minimize damage, reduce export and processing pressure. According to Ms. Vu Thi Kim Phuong - Deputy Director of the Department of Industry and Trade of Hai Duong province, every year, the whole province produces about 750,000 tons of rice, 900,000 tons of vegetables and tubers of all kinds, 300,000 tons of fruit and about 200,000 tons of livestock, poultry and aquatic products. Continuously for 3 years, from 2021 to 2023, the province has been supported by the Ministry of Industry and Trade to organize many important trade promotion events such as: Lychee Trade Promotion Conference; Carrot and Agricultural Products Consumption Promotion Conference... creating a strong effect, helping to promote the connection of production and consumption of agricultural products with many provinces and cities across the country. Accordingly, many businesses and retail corporations have chosen Hai Duong to promote product consumption. In addition, the province regularly organizes and participates in trade promotion events, connecting trade with provinces and cities across the country, especially with provinces and cities in the Red River Delta region.
For rice products, the domestic market is also gradually becoming a major priority for businesses to exploit. Chairman of the Board of Directors and General Director of ThaiBinh Seed Group Corporation Tran Manh Bao said: With a population of more than 100 million people, the domestic demand for rice will increase, creating an opportunity for businesses to expand production and consumption. Currently, the company sells about 1,500-1,700 tons of rice per year to the domestic market. ThaiBinh Seed has clearly defined the goal of improving product quality, expanding market share and increasing value for farmers right in this market.
Innovation in trade promotion activities
In Son La - one of the localities with the largest fruit growing area in our country, a concentrated agricultural raw material area has been formed with a large annual volume of agricultural products, such as: Longan output 136,556 tons; plum 95,602 tons; mango 77,512 tons; coffee 32,944 tons... In recent years, the consumption of agricultural products in the locality has been relatively favorable, greatly limiting the situation of good harvest, low price, bad harvest, high price. This is achieved thanks to the diversification of consumption channels and promotion of agricultural product trade.
Vice Chairman of Son La Provincial People's Committee Nguyen Thanh Cong said: To boost the consumption of these products, in addition to export, the domestic market plays an important role. Accordingly, the province strengthens trade promotion activities, advertises, introduces and connects agricultural product consumption to regions; develops e-commerce in a focused and key direction, avoiding overlaps and duplications between agencies and organizations to improve the quality, professionalism and effectiveness of the programs.
In addition to diversifying consumption channels, in order for businesses and localities to effectively exploit the domestic market, it is necessary to increase regional connectivity in trade promotion activities. Director of the Department of Trade Promotion (Ministry of Industry and Trade) Vu Ba Phu said that the Government needs to focus on directing investment in synchronous trade infrastructure to create momentum and regional connectivity in trade activities. In recent times, the Ministry of Industry and Trade has coordinated with localities to implement many trade promotion activities with long-term and stable regional connectivity. Specifically, in the provinces and cities of the Red River Delta, the midlands and northern mountainous regions, many regional trade fairs and exhibitions have been successfully organized, attracting the participation of thousands of businesses; however, the implementation of regional trade promotion activities is still facing some difficulties and has not achieved high efficiency. Therefore, in the coming time, localities need to develop long-term strategies based on research on the needs and capabilities of businesses, resources, and priority strategies of each locality; at the same time, increase information exchange and coordination with other localities to take advantage of each other's potential and advantages to penetrate each other's markets, promote and expand consumption space for local agricultural products...
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