Đề tài Improvement of export and domestic markets for Vietnamese fruit through improved post-Harvest and supply chain management - MS3

Ministry of Agriculture & Rural Development CARD Project Progress Report 050/04VIE Improvement of export and domestic markets for Vietnamese fruit through improved post-harvest and supply chain management MS3: SECOND SIX MONTHLY REPORT June 2006 1 1. Institute Information Project Name Improvement of export and domestic markets for Vietnamese fruit through improved post-harvest and supply chain management. Vietnamese Institution Southern Sub-Institute of Agricultural Engineering and Post-Harvest Technology (SIAEP) Vietnamese Project Team Leader Mr Nguyen Duy Duc, M. Eng. Australian Organisation Queensland Department of Primary Industries and Fisheries (DPI & F) Australian Personnel Mr. Robert Nissen; Dr. Peter Hofman Mr Brett Tucker; Mr. Roland Holmes; Mss Marlo Rankin Date commenced June 2005 Completion date (original) May 2008 Completion date (revised) June 2008 Reporting period Progress Report 1st Year June 2006 Contact Officer(s) In Australia: Team Leader Name: Mr. Robert Nissen Telephone: +61 07 54449631 Position: Project Leader Fax: +61 07 54412235 Organisation Queensland Department of Primary Industries and Fisheries (DPI & F) Email: bob.nissen@dpi.qld.gov.au In Australia: Administrative contact Name: Michelle Robbins Telephone: +61 07 3346 2711 Position: Senior Planning Officer (Emerging Technologies) Fax: +61 07 3346 2727 Organisation Queensland Department of Primary Industries and Fisheries (DPI & F) Email: michelle.robbins@dpi.qld.gov.au In Vietnam Name: Mr Nguyen Duy Duc, Telephone: +84 (8) 8481151 Position: Director SIAEP Fax: +84 (8) 8438842 2 Organisation Southern Sub-Institute of Agricultural Engineering and Post-Harvest Technology (SIAEP) Email: siaep@hcm.vnn.vn 3 2. Project Abstract The fruit industry in Vietnam has a great potential and plays an important role in agricultural production. In 2003, Vietnam exported US$43 million of high value fruit to high-income countries and imported US$14 million of fruit and vegetables. Vietnam is experiencing difficulties in competing with other Asian nations in export markets and its own domestic market, especially with China and Thailand. This suggests that Vietnam’s horticultural industries require substantial development to be globally competitive. Vietnamese consumers are demanding safer and higher quality fruit. This project has identified key pre-and post-harvest technology gaps that reduce product quality, safety and consistency. Targeted training programs are focusing on the total supply chain and are providing benefits by helping to implement quality management systems and GAP systems at the village level providing greater employment for the farming community. This project embraces the five CARD strategies for rural development; and in particular; strategies to increase production and competitiveness of agricultural systems; reduce poverty and vulnerability, and increase stakeholder participation whilst ensuring sustainability. 3. Executive Summary Baseline surveys were conducted for mango in Tien Gien and Khanh Hoa Provinces and for pomelo in the Vinh Long Province. In total, over 120 farmers, 30 collectors and 20 wholesalers were interviewed by the Vietnamese collaborators to obtain vital information on how the mango and pomelo supply chians are operating. Initial fact finding and surveys indicate that GAP, IPM and IDM issues are the largest issues affecting fruit quality in both mango and pomelo supply chains. GAP manuals are being developed based on current, and newly developed Asian Good Agricultural Practice (GAP) principles. Initial drafts of manuals have been completed for Mango Cultivation Handbook, Mango Pest Control Handbook, Mango Disease Handbook and Pomelo Cultivation, Pest and Disease Control Handbook, and further development of manuals is being undertaken. Post-harvest handbook for mango is being developed in collaboration with SIAEP and SOFRI staff. Workshops have been conducted using participatory action learning processes to enhance the knowledge of SIAEP and SOFRI staff. Workshops were conducted on: • developing supply chain maps on product movement, information and monetary flows • understanding of how supply chains function • a strengths, weakness, opportunity and threats (SWOT) analysis • a supply chain process analysis, that identified problems and solutions for mango and pomelo supply chains • developing strategic and action plans for mango and pomelo supply chains Workshops were also held in villages with mango and pomelo growers and with collectors to discuss supply chain maps, the SWOT analyses and strategic plans. This 4 enabled adjustment to the plans developed at earlier workshops, and to obtain support and input from a wider cross section of farmer/growers. Information from all of these sources was then used to develop the final industry mission statements, strategic and actions plans. These plans were found to be in line with objectives of this CARD Project. These objectives will be implemented during this project. The ORID system was used to evaluate the effectiveness of the workshops. Fifty percent of the workshop participants understood workshop concepts very well, while the remaining 50 percent said they were satisfied with their understanding of workshop concepts. Eighty three percent of the group indicated they would be confident in using these concepts with other supply chains and this training fulfilled their expectations. Benefits to grower/farmers involvement in the workshops and training exercises has been shown through one group been stimulated into proactively addressing and developing new and harvesting, handling and packaging systems which improved their first grade pack out percentage by 10%, thus providing greater scio-economic benefits to the village and the wider community. 4. Introduction & Background Ford et al., (2003) analysed the competitiveness of fruit industries in Vietnam and identified poor unstable product quality, no quality standards poor post harvest technologies and pre-harvest practices, lack of group co-operative marketing structures and little information about supply chains, prices and customers needs. This project addresses serious constraints through identifying key Vietnamese stakeholders from both government and industry sectors. It engages them and empowers them by focusing on the total supply chain network, and identify where benefits are to be gained. Stakeholder/beneficiary analysis conducted at project scoping and development stage showed that mango is an important fruit crop in the Mekong Delta (33 000 ha), and in the Khanh Hoa central coastal province (9 200 ha). Pomelo is also important in the Mekong Delta (9 000 ha). The objectives of the project are: • Improved pre-harvest technologies to produce high quality mango (integrated pest management, integrated crop management, fruit fly control, maturity indices, reduced pesticide residues, better environmental and human health etc) • Improved mango and pomelo post-harvest technologies (eg cool chain management, packaging, post-harvest dipping, ethylene ripening, waxing, washing and wetting agents, quality assurance) • Improved quality standards and quality assurance programs for mango and pomelo. The approach and methodologies developed for these crops through this project will be applied to other fruits and vegetables. 5 • Mapping of current supply chains to domestic and selected export markets, with particular emphasis on determining consumer preferences and needs, and reporting results back to farmers. • Provide a better understanding and possible improvements of the supply chain by Vietnamese fruit industries for mango and pomelo. This project will fill capacity gaps and reduce major weaknesses in pre-and post- harvest technologies affecting product quality consistency and supply chain management and planning. Highly specialised targeted training programs appropriate for institutions and industry stakeholders will be provided. At the local village and district level, cluster development of farmer/grower groups should ensure better on-farm prices, through increased power to these farmers/growers benefiting all members of the supply chain farmers, intermediaries to retailers rather than the present powers brokers in the chain. Farm incomes will therefore increase and result in better standard of living for rural and women. In addition, if quality management systems are implemented at the village and district level, through more appropriate fruit quality standards, packaging and grading systems implemented. The benefits may be increase returns resulting in greater employment at the local village level. The flow on affects of this will benefit the poor in the rural areas, and specifically help provide more jobs for rural women. 5. Progress to Date Implementation Highlights Baseline Surveys Supply chain baseline surveys were conducted by SIEAP and SOFRI staff for mango in Tien Gien and Khanh Hoa Provinces and for pomelo in the Vinh Long Province. Mango and pomelo production for the relevant regions revealed: • Mango o South East Vietnam:- 18 685ha producing 70 622 tonnes annually o Mekong Delta:- 22 001ha producing 193 383 tonnes annually o Khanh Hoa Province:- 5 800ha producing 18 800 tonnes annually • Pomelo o South East Vietnam:- 1 422ha producing 12 932 tonnes annually o Mekong Delta:- 8 298ha producing 108 916 tonnes annually About 20% of Vietnam’s population live in the Mekong Delta Region with 85% living in rural areas. About 80% of rural farms range in size from 0.5 to 2ha. The lower poverty line defined by Vietnamese General Statistics Office (GSO) is; expenditure per capita required for securing a minimum nutritional requirement (2100 calories per day). Therefore, the poverty rate below the lower limit calculated by the (GSO) in 2003 showed that the total poverty percentage for each Vietnamese region where this project is operating is: • Mekong Delta 23.7% 6 • South Central Cost 25.9% These percentages are lower than Vietnam’s average poverty rate of 28.85 percent. The only other region to record a poverty rate below this is the Red River Delta region (22.4%). The rural poverty rates have the similar trends and are: • Mekong Delta 26.56% • South Central Cost 31.27% In total, over 120 farmers, 30 collectors and 20 wholesalers were interviewed by the Vietnamese collaborators to obtain vital information on how the supply chains for mango and pomelo are functioning in Vietnam. Surveys will be conducted at the end of the project for further comparisons. Survey data was presented at the first workshop during the second project trip in April-May 2006. Information obtained was then used in subsequent workshops to develop models of the supply chains for mango pomelo operating in Vietnam and to develop the strategic plans for mango and pomelo. Brief Summary of Mango Baseline Survey Information • Total Mango area and production for the South East is 18 685 ha producing 70 622 tonnes/year, Mekong Delta Region 22 001ha producing 193 383 tonnes/year and Khanh Hoa Province 5 800ha, producing 18 800 tonnes/year. • Vietnamese consumers regard the “Cat Hoa Loc” as the number one variety in Vietnam. • In the Mekong Delta, about 72% of mango fruit are transported from farm to collector by boat, but in Khanh Hoa Province 100% are via some form of road transport. Farmers, collectors and wholesaler believe that only 1-2% of fruit is damaged during transport in 30 to 50 kg bamboo baskets or crates. • In the Mekong Delta a small percentage of mango is graded at the farm level but most fruit are graded and sorted at the collector and then again at the wholesaler level in the supply chain. In contrast, for Khanh Hoa Province, about 54% of farmers grade their fruit. • In the Mekong Delta there are three basic grades, Class 1:- 420-500g, Class 2:- 300-420g and Class 3:- <300g, whilst in Khanh Hoa there are also three grades, Class 1:- 1-3 fruit/kg, Class 2:- 4-6 fruit/kg and Beer class >6 fruit /kg. Fruit grading is carried out by eye. Improvement and standardisation of quality standards as well as adoption by all participants in the supply chain is need. • Most fruit are sold hard green, ripe fruit are not wanted. • Collectors/farmers prefer to sell mixed grades even though the farm gate price will be low. This is done to allow collectors/farmers to sell Class 3 fruit which they could not normally sell. On the other hand many wholesalers find it extremely difficult to sell Class 3 fruit. This adds significant costs to all aspects of the supply chain and affects farmers/grower returns. 7 • Selling price for fruit:- Majority of farmers obtain the price of fruit locally. This is achieved by asking as many collectors, farmers and wholesalers as possible at the district level for their price paid or received for fruit sold. • Price is usually set and established with farmers on day of sale or the day before and based on the market supply on any given day. • Majority of farmers do not know the price of mango at the HCMC wholesale market. • Wholesalers reported that most fruit will keep for 4 days with out the use of special storage facilities. Presently there are no storage facilities located the HCMC wholesale markets for wholesalers to use). • At the wholesaler point in the supply chain, once the fruit is mature, for each day that it is not sold, traders will reduce the price by 500-10 000 vnd/kg. Brief Summary of Critical Pomelo Baseline Survey Information • In the Mekong Delta, the Vin Long Province is considered as the leading growing region in Vietnam for Pomelo. • Total area and production in the Southeast is 1 422ha, producing 12 932 tonnes/year and for the Mekong Delta Region 8 298ha producing 108 916 tonnes/year. • The pomelo variety “Man Roi” is considered the number one variety in Vietnam. • There are as many as 2 to 4 grades/standards of fruit depending upon market and time of season. Each class grade standard changes, based on early season production, mid-season and late-season production. For example, local market there are 2 classes/grade standards, Hoang Gia Company uses 3 classes or grade standards and the wholesale market in HCMC 4 classes or grade standards. • In the Mekong Delta, about 62% pomelo fruit are transported from farm to collector by boat, and 66% transported by road to HCMC and the remainder by boat in 80 to 85kg bamboo baskets. • Of the total production from Vin Long Province it is estimated 5% to 6% is for local consumption. In 2004, Metro Cash and Carry marketed 145 tonnes of pomelo fruit. Also in 2004, 50 tonnes of pomelo was exported to Germany. In 2005, a 100 tonnes was exported to Germany and Russia and the price was US FOB HCMC $590USD/tonne (about 9 200VND/kg). The CARD Project team are currently completing analysis of the baseline survey data. Following data analysis reports will be prepared and PowerPoint presentations will be made to Vietnamese Collaborators (SIAEP & SOFRI) and to the mango and pomelo farmers, collectors, transporters, traders and wholesalers. GAP Manual Development Initial drafts of manuals have been completed. These are Mango Cultivation Handbook, Mango Pest Control Handbook, Mango Disease Control Handbook and the Pomelo Cultivation Pest and Disease Control Handbook. Further development will be undertaken on these manuals. Post-harvest handbook for mango is being developed in collaboration with SIAEP and SOFRI staff. 8 These manuals are based on current, newly developed Asian Good Agricultural Practice (GAP) principles and will include farmer achievable improvements. These technical manuals are being designed to be easily broken down into extension officer’s guides and farmer/grower flip book or pocket field guides for IPM, IDM and problem solving for the growing mango and pomelo. Manual development and format will have the capacity to be regularly updated and maintained. This will provide a system as farmer/grower GAP practices and knowledge improves, they can move up to the next GAP level or step up to the next knowledge level. Initial fact finding and surveys indicate that GAP, IPM and IDM issues are the most important factors affecting fruit quality in both mango and pomelo supply chains. It is essential that these elements be corrected first before any substantial change can be achieved though the supply chain. Participants downstream along the supply chain cannot enhance fruit quality only maintain it with good practices and the saying “garbage in garbage out’ is typical of any supply chain with poor quality fruit entering the chain. Integrated pest management (IPM) and biological control methods have been well established in many developed countries. However, increased consumer demand for 'clean and green' products, greater understanding of occupational health and safety on farms, and ecological and environmental issues and higher chemical costs have all combined to highlight the need for greater IPM and IDM type practices. Vietnamese growers must develop practical IPM and IDM systems to suit their own industry situations and implement them to be international and domestically competitive as well as scio-economically and environmentally sustainable. Mango and Pomelo Industry Development Three Australian team members travelled to Vietnam in April-May 2006 to conduct capacity building exercises and run a series of 6 workshops. These workshops used participatory action learning processes and capacity building for SIAEP and SOFRI staff to develop: • supply chain maps • conduct a strengths, weakness, opportunity and threats (SWOT) analyse • carry out a supply chain process analysis • develop strategic plans for mango and pomelo supply chains for participating CARD project members. CARD Project members participating in these workshops were SIAEP and SOFRI staff, farmers, collectors, traders, wholesalers and marketers etc., (see Appendix B). All were involved in a participatory action learning process to develop the supply chain maps, carry out SOWT analyses, develop strategic plans and participate in the supply chain process analyse. See Appendix A for supply chain maps and SWOT analyse. Workshops were also held in villages with mango and pomelo growers (see Appendix B) and with collectors to discuss supply chain maps, the SWOT analyse and strategic plans developed at previous workshops and to adjust and obtain input from a wider 9 cross section of farmer/growers. This consultative and participatory action learning approach is designed to empower the rural poor in the decision making processes. Based on the agreed vision, goals and future direction for both the mango and pomelo CARD project participants developed action plans based on the strategic plans. These action plans for both the mango and pomelo supply chains aligned with this CARD Project objectives. Therefore, the action plans developed indicate the project activities for the next 2 years. Also outlined, are the reports and manuals to be produce. These action plans, reports and manuals were discussed at the final workshop during the Australian team visit in April-May 2006 (see Appendix C). Strategic Planning for Mango and Pomelo Industries Industry Mission Statements Mango Maintain stable incomes (prices) and consistent access to good markets by improving pre-and post-harvest practices, QA s