Vietnam agricultural seed market worth billions of dollars

        Vietnam has to import billions of dollars worth of products every year. Analysts, considering the stable two-digit growth rate of the market, have predicted that market value may reach $1.7 billion by 2020, while demand for merchandise seeds may increase by twofold, accounting for 70 percent of the total plantation area in the next five years.

        The figures show that Vietnam is a lucrative soil for multi-national agriculture groups such as Mosanto (US), CP Group (Thailand), Syngenta (Switzerland), Vilmorin (France), East West (the Netherlands), Bayer CropScience (Germany) and Sakata (Japan) to cultivate.

        Imports have been dominating the domestic seed market. Even when Vietnamese companies are believed to have advantages in the rice seed market, they can only satisfy 33 percent of the demand, according to the Ministry of Science & Technology.

        According to Vo Tong Xuan, who is considered the best-known agricultural expert in Vietnam, it takes at least several years to create a new variety, while it took 17-20 years to create a new mango variety.

        This is the reason why only five to six corporations out of 260 seed and seedling enterprises can create new varieties by cross breeding.

        The corporations include Vinaseed, Thai Binh Seed, SSC and Loc Troi Group. While the first two corporations are better known in the northern and central markets, the other two hold the southern market. They mostly provide rice and corn varieties.

        Vinaseed now holds 15 percent of the rice seed market share and 10 percent of the corn market share.

        SSC also holds 10 percent of the corn seed market share. Corn seeds made the largest contribution to the company’s revenue in 2015, followed by rice seed. Meanwhile, vegetable seeds brought only 15 percent out of the total revenue of VND600 billion.

        Vietnamese companies have been trying to upgrade their capability to grab the opportunities. Vinaseed, SSC and other companies all strive to increase the proportions of products with high technology content.

        In 2015, Vinaseed’s products with high technology content accounted for 60 percent of its total products. This allows seed companies to have a gross margin profit of 30-40 percent.

        However, analysts commented that Vietnamese seed companies remain incapable of gaining the upper hand over foreign companies.

        At least 70 percent of hybrid rice varieties in the north are imports, while Vinaseed distributes hybrid rice seed from China. SSC has distributed hybrid rice seed for Dekalb, a subsidiary of Monsanto.

Source: VietNamNet Bridge

相关新闻