Cooperatives currently have abundant sources of agricultural products and goods because they are promoting large-scale production and chain linkages. Therefore, if the logistics and preservation problems can be solved, it will help cooperatives improve their competitiveness.

Ms. Tran Thi Viet Anh, Director of Khanh Hung Clean Fruit Cooperative (Ca Mau) said that expanding the consumption of agricultural products in provinces and cities helps the output of fruit products more conveniently, but it also comes with the worry of transportation costs. If transporting a container from Ca Mau to consume or do plant quarantine in Ho Chi Minh City, it will cost about over 18 million VND.

Increase costs, reduce profits

According to Dr. Nguyen Hong Yen, Head of the Department of Cultivation and Plant Protection of Hoa Binh province, each container of grapefruit exported from Hoa Binh to Korea increased by 30 million VND because it had to be transported to the South to carry out pest treatment steps with hot steam according to the regulations signed between the two countries.

Obviously, logistics shortcomings are increasing the costs of cooperatives and enterprises. Logistics costs account for a significant amount of the total costs of cooperatives, which experts explain is due to Vietnam's vertical terrain and high fuel prices.

Many people ask: why are there agricultural products and goods from China that when arriving in Vietnam have a shipping time even faster than buying domestically, especially through e-commerce?

According to experts, this is because China has strongly developed a widespread highway and train system, connecting most rural areas with urban areas. The expressway system connecting directly from commodity production areas to border gates of border countries or seaports and airports is a prerequisite for reducing transportation costs.

A cooperative in Phu Yen said that if cassava and tapioca starch are transported to Lang Son by road, the cost is about 1 million VND/ton, thereby reducing the cooperative's profits. Not to mention that when goods reach the border gate, they are congested and have to wait for many days, increasing storage and loading costs.

The increase in transportation costs also weakens the competitiveness of cooperatives because currently, fresh agricultural products account for 70% of the export, the shorter the transportation time, the more convenient the road, the less loss and damage.

A logistics expert said that China's lower logistics prices lead to lower prices of goods and agricultural products, and faster time to reach consumers. This is partly because retail gasoline prices in China are only 70-80% of those in Vietnam.

Along with that, the price of containers and cars used to transport goods and agricultural products in China is only 50% of the price in Vietnam, even though it is the same type of car. This is partly because China is proactive in car production, and partly because when cars arrive in Vietnam, they have to pay many taxes, forcing people, cooperatives, and businesses to buy cars to transport goods at higher prices.

According to calculations, the cost of transporting 1kg of vegetables and fruits from Da Lat (Lam Dong) to Hanoi is about 3,000-4,000 VND. But if the same distance, 1kg of agricultural products in China only costs about 1,000 VND.

"That is not to mention that China is very interested in investing in a system of factories for preliminary processing, packaging and a system of cold storage for gathering and preserving goods. This also promotes reducing transportation costs and reducing the loss rate. Meanwhile, in Vietnam, there is a lack of cold storage, processing factories and post-harvest stages are still mostly done manually," Ms. Nguyen Thi Thanh Thuc, Chairwoman of Bagico Joint Stock Company analyzed.

Increase performance, reduce costs

MSc. Nguyen Thanh Tung, Vietnam Fruit and Vegetable Association, said that the Association has about 300 members and collaborators, 125 official members in many fields of agricultural production, processing, logistics, services, import-export trade. However, only 2 out of 300 members are FDI enterprises, accounting for 0.67%. This also shows certain weaknesses in investment in goods transportation as well as post-harvest stages.

Not to mention that Vietnam is lacking standard cold storage and preservation systems. This increases the possibility of loss and damage to agricultural products after harvest. Many production facilities and cooperatives do not have enough capacity to access advanced agricultural product preservation equipment such as air conditioners and dryers. Also due to the limitation of cold storage, Vietnam's ability to preserve agricultural products is short-term, not long-term to serve export.

Mr. Hoang Van Du, Deputy Director of the Agricultural Trade Promotion Center (Ministry of Agriculture and Rural Development) said that sometimes people buy goods from abroad faster than ordering domestically, showing that countries near Vietnam have developed strongly in logistics, while Vietnam has not been able to do that.

Therefore, what needs to be done now is to complete the transportation system to connect rural areas with urban areas, urban areas with border gates, seaports, airports, etc. Currently, logistics costs in Vietnam are high not only because of underdeveloped transportation infrastructure but also because there are too many toll stations. This is a hidden cost that reduces the profits of cooperatives and enterprises and is not suitable in the context of strong e-commerce development. As e-commerce develops, the competition to bring goods to consumers sooner needs to be paid more attention.

Currently, calculating the consumption of goods in Muslim countries such as the Middle East, Malaysia, Indonesia is encouraged because there is still much untapped potential. If well utilized, it will help export units reduce logistics costs because transportation and procedure fees in these markets are generally lower than in markets such as the US and EU.

However, this is only a certain solution because the need to expand the market is an indispensable requirement for each cooperative and enterprise. To reduce transportation costs, the first thing is that the domestic infrastructure system needs to be completed. Because according to many enterprises that have invested in processing factories in provinces such as Dong Dao, Doveco..., going to the growing areas to purchase agricultural products still faces many difficulties because of remote areas and lack of investment in transportation.

Under current conditions, experts from the World Bank in Vietnam believe that in order to transport agricultural products for export well, the logistics industry in Vietnam needs to aim for higher efficiency and lower costs. For example, currently about 70% of trucks carrying goods go out but return almost empty.

Source: VnBusiness