Many agricultural products are at high prices, but cooperatives and businesses that trade and process agricultural products are not necessarily making a profit. This is due to the bottleneck in commodity prices that still depend on the market, agricultural products are still sold at low prices while cooperatives and businesses have not yet determined the prices for their agricultural products and goods.

Statistics from the Ministry of Agriculture and Rural Development show that in the first eight months of the year, the total export turnover of agricultural, forestry and fishery products reached 33.21 billion USD. Of which, agricultural products contributed 16.9 billion USD, up 11.5% over the same period last year.

Price confusion

In particular, many agricultural products such as rice, coffee, pepper, rice, vegetables and fruits are maintaining high prices and continuously setting new price records. Even coffee prices, currently in the domestic market, are around 123,500 - 124,000 VND/kg. And for the first time in history, Vietnam's coffee export price has exceeded 5,000 USD/ton.

However, many cooperatives and businesses are still not happy with the increase in coffee prices because the price of fresh coffee has increased, but after the purchasing process for processing, green coffee beans and roasted coffee still cannot increase the selling price (because before that, the business had signed a contract with the old price for a certain period of time).

This causes the end traders to suffer losses and go bankrupt. Therefore, many businesses have to close after the storm of increasing agricultural product prices, most recently the dizzying price increases of coffee, pepper, durian, rice, etc.

Many Vietnamese agricultural products are highly appreciated for their quality and deliciousness but are still sold at low prices.

According to experts, this is also a manifestation of many Vietnamese agricultural products, not just coffee, pepper... Because when prices increase, if processing enterprises negotiate with agricultural suppliers to reduce purchasing prices, it will lead to a vicious cycle of good harvest and low prices.

On the contrary, if processors and businesses lose money and stop operating, there will be no businesses linking with farmers and cooperatives to purchase agricultural products and the value chain of goods will not be developed.

Mr. Chi Anh, founder and CEO of Ago Import-Export Company Limited, said that the key issue of this situation is the price of agricultural products and goods. Price fluctuations are one of the difficulties in export business. The advantage of increasing agricultural product prices is that people and cooperatives can sell agricultural products at high prices, increasing income.

However, if it leads to a situation where both sides have to consider and discuss purchasing prices at a low level (compared to the market), a vicious cycle will occur in the issue of prices. This can lead to self-suppression or cessation of cooperation between farmers, cooperatives and enterprises.

Mr. Pham Thanh Tung, Deputy Director of the Institute of Agricultural Tourism Economics, said that even if the unit purchasing agricultural products for processing is a large corporation or a typical cooperative, if it tries to sell agricultural products and goods at low prices, that unit is having problems with pricing agricultural products.

This leads to a situation where cooperatives and enterprises can be the ones to create commercial products but have no value. And the consequence is that farmers and cooperative members, although directly producing goods and participating in the value chain, are always miserable because their income is not high.

Together to increase the selling price of goods

It can be seen that market price fluctuations are what causes both cooperatives and enterprises to face many difficulties and challenges in association and cooperation. Mr. Le Su, Chairman of the Board of Directors of the Green Agricultural Development Investment Service Cooperative (Dong Nai) said that if organic rice production is combined with value addition through processing and agricultural tourism, the local rice price is currently around 25,000 VND/kg, should the cooperative decide to sell at a higher price of 35,000 VND/kg?

According to experts, the only solution to find a suitable price for the production and business model is for businesses and cooperatives to sit down together to decide to increase the selling price of agricultural products and goods.

Because customers always want to experience things they have never experienced before. And in the market, there are always customers who want to find experiences of high value.

Therefore, Mr. Pham Thanh Tung believes that cooperatives should not worry about the fact that they can create unique agricultural products with a value many times higher than normal products but have no buyers. "Many units, businesses, and cooperatives almost only focus on selling at low prices, because they are afraid of being made difficult and with the thought of 'buying with friends, selling with partners'," said the Deputy Director of the Institute of Agricultural Tourism Economics.

Mr. Rocky Ngoc Thach, CEO of Smart Link Logistics, said that after discussing to find a way to jointly increase the selling price at a high level for agricultural products, cooperatives and enterprises can allocate a portion of their profits to create a "stabilization fund" to deal with unforeseen situations regarding the prices of agricultural products and goods.

When we do not work together to increase the selling price of agricultural products, the vicious cycle of "good harvest, low price, good price, bad harvest" will still occur. And every year, from farmers, cooperatives to departments and branches still have to face this situation and continue to blame the factors in the value chain of goods.

In particular, if the selling price of agricultural products cannot be increased, not only cooperatives will be affected but the entire agricultural sector will find it difficult to develop. Because if just one item has an increased selling price, it will contribute significantly to increasing the total export turnover of the entire agricultural sector. Not to mention if Vietnam's agricultural products have high value like Japan's agricultural products, the export turnover of agricultural, forestry and fishery products will be many times higher because Vietnam is an agricultural country and has agricultural products that are considered to be among the best in the world such as coffee, lychee...

Source: VnBusiness