Editor's note: Despite achieving impressive export figures, up to 90% of Vietnam's agricultural products are still exported in raw form, with export prices lower than similar products from many other countries.
80% of exported agricultural products have not yet built a brand, do not have their own logos or labels, and have not fully participated in the global value chain. Many products are exported and sold in foreign markets under brands that are not owned by Vietnamese enterprises. Therefore, building agricultural product brands to boost exports requires strategic vision and fundamental solutions in the coming period.
Building brands, increasing agricultural product value
The Resolution of the 13th National Party Congress and the 10-year Socio-Economic Development Strategy for the period 2021 - 2030 of Vietnam have emphasized the comprehensive and synchronous completion of institutions for the development of a socialist-oriented market economy, creating a favorable environment for mobilizing, allocating and effectively using resources, promoting investment, production and business. Ensuring macroeconomic stability, strongly innovating the growth model, restructuring the economy, promoting industrialization and modernization of the country; focusing on building infrastructure and urban development; developing rural economy associated with building new rural areas; prioritizing resources for developing rural infrastructure in mountainous areas and ethnic minority areas; promoting national digital transformation, developing digital economy on the basis of science and technology, innovation; Improve productivity, quality, efficiency and competitiveness of the economy, harmoniously and effectively connect domestic and international markets.
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| Rice - one of Vietnam's main agricultural export products |
Identifying branding for agricultural products plays a very important role in increasing the value and improving the quality of products, increasing competitiveness in the market, preserving and promoting the cultural values of traditional and indigenous products, contributing to enhancing the position and value of Vietnamese agricultural products in the world market.
With that policy and orientation, the issue of developing agricultural product brands has also been specified in a number of Government documents such as "focusing on developing industry brands, branded products, and competitiveness to participate in the global value chain" (Resolution No. 40/NQ-CP dated May 10, 2017); "strengthening the building of national brands, export product brands and enterprise brands" (Decision No. 1137/QD-TTg dated August 3, 2017 of the Prime Minister approving the Project to improve the competitiveness of Vietnam's export products by 2020, with a vision to 2030); “Supporting market access capacity for small businesses, cooperatives and farming households (developing geographical indications, establishing growing area codes, packaging facility codes, protecting intellectual property, protecting trademark copyrights, etc.)” (Decision 150/QD-TTg dated January 28, 2022 approving the Strategy for Sustainable Agricultural and Rural Development for the 2021-2030 period, with a vision to 2050) and a number of other major programs.
The development of agricultural production and trade has contributed positively to the development of Vietnam's agriculture and rural areas in recent years. Accordingly, people's lives have been constantly improved, the face of the countryside has been constantly renewed, production methods have changed positively, the structure of the agricultural market has been consolidated and gradually integrated deeply, agricultural products have been improved in both quantity and quality. Some key agricultural products have affirmed their position and competitiveness in the world market, such as rice, coffee, pepper, seafood, etc.
The report of the Ministry of Agriculture and Rural Development sent to the National Assembly recently on the implementation of Resolution No. 44/2017/QH14 of the 14th National Assembly on questioning activities has detailed the story of building brands for Vietnamese agricultural products. Specifically, for rice products, the national brand Vietnam Rice has been granted the VIETNAM RICE/VIETNAM RICE trademark certificate; the organization announced the logo of the national brand Vietnam Rice and issued the Regulations on the use of the national certification mark Vietnam Rice.
In addition, the program to build a brand for high-quality coffee and brands for seafood products (shrimp, pangasius) is being vigorously directed. However, the above activities have only been implemented for a number of agricultural products, and have not covered the strengths of the entire “agricultural” sector. There has also been a policy to build a brand for key agricultural products, but the results have not been much.
Trademark Where is Vietnamese rice on the world map?
Canada is a rice importer serving about 7 million people of Asian origin. Vietnam is one of the 10 important rice exporters to Canada, after the United States, Thailand, India, and Pakistan, but only has a very small market share (1.6%, before the CPTPP Agreement was signed).
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| Vietnam's rice market share in the Canadian market increased from 1.6% before the CPTPP Agreement was signed to nearly 2.9% in 2023. |
In 2023, Vietnam recorded a growth rate of rice products up to 56.4% in this market, being the country with the highest growth rate in turnover, contributing to Vietnam expanding its market share to nearly 2.9%.
Vietnamese rice exported to the Canadian market is mainly milled white rice, the amount of brown rice and broken rice exported is insignificant. Recently, Vietnamese rice has been highly appreciated by importers for its quality. Some Canadian import partners have begun to realize that the quality of Vietnamese rice is not inferior to Thai rice. However, some importers are not satisfied with the broken rice content (still around 5%) while other countries such as Thailand have better milling quality, the broken rice ratio is almost 0%.
In addition to long white rice (jasmine), currently, round Japanese rice grown in Vietnam is being imported quite strongly by Canada, which is one of the reasons for the growth of rice turnover to the market in 2023. However, like jasmine white rice, round sushi rice is packaged under the packaging and brand of foreign corporations.
The prospect of Vietnam's rice exports to the market in the coming time will remain very positive thanks to the price advantage compared to similar products of competitors. The network of overseas Vietnamese businessmen is an active partner supporting the increase of Vietnam's rice market share in Canada, especially bringing high-quality ST25 rice to the market.
However, the significant difficulty for Vietnam's rice exports is that there is no brand, so consumers do not recognize it to choose. The decision to buy Vietnamese rice is still mainly based on price, not brand loyalty.
Not only the Canadian market, the Philippines is the number 1 rice import market of Vietnam. Many Vietnamese rice enterprises have long-term business relationships with Philippine rice importers, creating prestige and trust in rice export with Philippine customers.
Vietnamese rice has moderate quality, suitable for the tastes and consumption habits and meets the diverse needs of Philippine consumers, from the large middle and low income population to the wealthy classes, and is affordable and competitive.
Vietnam's rice supply is stable, both in quantity and price, and can meet the Philippines' annual import needs. The geographical distance makes transportation cost and convenience. Vietnam also takes advantage of bilateral and multilateral trade agreements that the two sides participate in, while the Philippines' non-ASEAN partners such as India and Pakistan do not have them.
The Philippines is Vietnam’s largest rice export market. However, the “low point” of Vietnam’s rice industry in this market is the lack of Vietnamese rice brand.
Mr. Phung Van Thanh - Vietnam's Trade Counselor in the Philippines - informed that although Vietnam exports a lot of rice to the Philippines and Filipinos also use a lot of Vietnamese rice, it seems that Philippine importers "don't trust it much", so Vietnamese rice bags never have big labels like those from Japan or Thailand.
According to Mr. Phung Van Thanh, in the past, when Filipino consumers mentioned rice, they thought of Thai and Japanese rice, although they consumed Vietnamese rice, they did not rate it highly. This raises the issue of branding so that when Vietnamese rice enters Philippine supermarkets, or at wholesale and retail rice stores in the Philippines, they can proudly display the sign "Product of Vietnam" or "Vietnamese Rice". This will be better for the Vietnamese rice production and trading industry.
“In 2022, the Vietnam Food Association organized a business delegation to promote trade and conduct surveys at supermarket systems. All packaged Thai and Japanese rice had large and beautiful words like “Thai Rice” and “Japan Rice” on the packaging; but Vietnamese rice could not be found to be of Vietnamese origin. After we searched for a long time, we finally saw the very small words “Product of Vietnam” printed at the bottom of the packaging,” Mr. Thanh cited.
Therefore, Mr. Thanh recommends that, in addition to boosting rice output and export turnover, improving quality and enhancing business reputation, businesses and managers should try to build a Vietnamese rice brand.
Brand recognition of Vietnamese rice in markets is not really clear.
The Netherlands is the gateway for trading goods into the European market, including rice trade. The Netherlands imports rice from 241 countries and territories around the world. The value of rice imported from Vietnam accounts for 2.6% of the total value of rice imported into this market.
According to the Vietnam Trade Office in the Netherlands, the Dutch mainly eat potatoes and bread, so rice is not a staple food. In addition, the culinary culture of the Netherlands is deeply influenced by Indonesia, Surinam and India, so the rice they use in cooking is Basmati rice, not fragrant sticky rice.
Vietnamese rice is imported and distributed mainly in Asian supermarkets owned by Vietnamese people, a small amount in supermarkets in Pakistan, Türkiye, China, and has not yet reached large supermarkets in the Netherlands.
The retail price of Vietnamese rice in Asian supermarkets is higher than that of rice imported from Thailand and Cambodia, ranging from 3.85 to 4 euros/kg, while the price of fragrant Thai rice is from 3.65 to 3.85 euros/kg; Cambodian rice is cheaper, ranging from 3.5 to 3.65 euros/kg.
"Thai and Indian rice have entered the market very early, and have been proven to have stable quality for a long time, so they have a fairly solid position in the market. Vietnamese rice has been reported by Vietnamese consumers in the Netherlands to have unstable quality, and its price is higher than Thai and Cambodian rice, so in many cases, after using it once or twice, they return to using Thai rice with stable quality and better price," said a representative of the Vietnam Trade Office in the Netherlands.
Vietnam is in the Top 3 leading rice suppliers to the Indonesian market, however, according to Mr. Pham The Cuong - Vietnam Trade Counselor in Indonesia - information, Vietnamese rice will have to face not small challenges in this market. In particular, the recognition of Vietnamese rice brands in this market is not really clear. In many supermarkets in Indonesia, Thai rice has a brand and is easily recognizable to consumers.
| According to the World Intellectual Property Organization (WIPO): “A brand is a special sign (tangible or intangible) to identify a product, a commodity or a service produced or provided by an organization or an individual”. |
Lesson 2: Branding: Where does it get stuck?
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