- Vietnam’s dragon fruit export output has continuously decreased sharply since 2019
- Vietnamese farmers and businesses need to reassess the market to promote its advantages
Former status of Vietnamese dragon fruit
Dragon fruit is a drought-resistant plant, easy to grow, and produces sweet fruit. Around the beginning of 1990, a few Taiwanese traders discovered Binh Thuan dragon fruit, offered it to a number of Asian countries and gained popularity, thereby opening up opportunities for export dragon fruit. Realizing export opportunities, Vietnam has put efforts in creating favorable conditions for this typical tree. Dragon fruit is grown in 30 provinces and cities, but thrives in large-scale specialized farming areas concentrated in the provinces of Binh Thuan (29,000 ha), Long An (11,000 ha) and Tien Giang (8,000 ha), accounting for 93.6% of the planting area and 95.5% of the country’s output.
During its international debut, dragon fruit is a “rare” fruit for many countries due to climatic and soil conditions which make them unable to plant this fruit. This had increased the uniqueness of Vietnamese dragon fruit in the export market at the time, accounting for 80-90% of transactions. Therefore, the export value of Vietnam’s dragon fruit has also increased continuously, from 57 million USD in 2010, up to 483 million USD in 2015 and reached 1.1 billion USD in 2018.
Up until now, more than 15 countries and territories are the export “territory” of Vietnamese dragon fruit. In addition to traditional markets such as China, Thailand and Malaysia, the fruit also succeeds in reaching difficult markets such as the United States, Japan, South Korea, New Zealand and Australia.
The decline in exportation
However, statistics from the Vietnam General Department of Customs show that from 2019, Vietnam’s dragon fruit export output has continuously decreased sharply. Particularly, in 2021 and 2022, dragon fruit has fallen out of the top billion-dollar export items of Vietnam. Last year, the export output of this item was only over USD 632 million, decrease nearly 39% compared to 2021 and down over 49% compared to the peak of 2019.
In the first two months of this year, dragon fruit exports were more optimistic but only reached US$106 million, down 26.9% compared to the same period in 2022. It is predicted that dragon fruit export output in 2023 will continue to decline.
The director of a dragon fruit purchasing business in Binh Thuan also said that his company these days can only export several dozen, sometimes only a few containers of dragon fruit. The number before was up to hundreds.
Who’s responsible for this fall?
There are many reasons leading to the “failure” of dragon fruit.
Firstly, the Covid-19 epidemic has blocked the export path of many Vietnamese goods in general and dragon fruit in particular. From the export side, many provinces and cities have implemented social distancing. Consequently, traders’ activities were restricted, making it difficult to transport to international countries. From the import side, distance and border closure from partner countries also contribute to the congestion of dragon fruit export routes. The strict Zero-COVID policy of China, a close friend and importer of Vietnamese dragon fruit, has caused the country’s border to be continuously closed in the years from 2020 to 2022.
Secondly, many countries are gradually becoming self-sufficient in supply or even gaining the ability to participate in the export race.
After torning down its lockdown wall, China was thought to continue its support towards Vietnamese dragon fruit, but the country is now actively cultivating dragon fruits, so the import demand is more limited than that of the years before COVID-19. Specifically, Chinese dragon output of 2022 was 1.6 million tons, 200,000 higher than Vietnam, helping the country to reach the leading position in international dragon fruit output. This productivity is expected to soon meet the consumption demand of about 2 million tons a year of its people. If crop productivity continues to increase, in just a few years, China will no longer need to import dragon fruit.
India has also recorded successful cultivation of this fruit. Recently, the Government of India decided to build a farming roadmap to 50,000 hectares in the next 5 years. There is even a risk that goods from outsiders will be exported back to Vietnam when their prices are cheaper.
Losing the game in Asian markets is one thing, Vietnam’s “green dragon” also has to face a clash with Mexico in the American market. In 2010, Vietnam exported dragon fruit to the US very smoothly. However, since 2019, when Mexico was able to cultivate dragon fruit, Vietnam’s export market share in the US and Canada market has decreased.
Thirdly, Vietnamese fruits do not meet inspection standards or are taxed high in some countries. Some countries like Japan or the United States are famous for having high inspection standards and have “shaken their heads” when facing Vietnamese fruits. Particularly, Vietnamese dragon fruit has been rejected many times because the concentration of pesticides exceeds the permissible limit. India is also an “out of reach” destination because it often imposes high taxes on Vietnamese vegetables and fruits.
Solution in sight
In the context that China and India are “chasing” Vietnam’s dragon fruit export position, Dang Phuc Nguyen, General Secretary of the Vietnam Fruit and Vegetable Association (Vinafruit), said that Vietnamese farmers and businesses need to reassess the market to promote its advantages.
In addition to focusing on product quality and design, farmers need to choose the right time to cultivate. That is, instead of planting massively as before, farmers should consider investing in the crops in which your country cannot grow trees. In winter, it is difficult for China to grow dragon fruit. Therefore, Vietnamese farmers should increase planting dragon fruit for harvest at the beginning and end of the year because at this time there will be less goods from neighboring countries. Of course, farmers should not be left “alone” in this competition. Local authorities in the South Central provinces need to inform and direct farmers so that they can prepare and cultivate according to the calendar.
Besides white flesh dragon fruit, Vietnam also has another strength, red flesh dragon fruit. This variety is sweeter than white ones, but rival countries have not yet cultivated it. Therefore, the direction of increasing the cultivation of red flesh dragon fruit is also mentioned by experts.