US-China trade war to hurt or benefit VN agriculture?
2018.07.19
The ongoing US-China trade war will greatly impact the structure of the world economy in the future, causing damage but also generating indirect opportunities for countries where the economy relies heavily on agricultural production like Việt Nam.
According to head of the Việt Nam Cashew Association’s Trade Promotion Division Trần Văn Hiệp, although it is still quite early to assess the impact of the US-China trade war, it’s possible that Vietnamese cashews may benefit from this war.
Hiệp said the US was now one of the world’s leading almond exporters. Therefore, if China imposed a tax on this product, it would certainly affect US almond exports. Meanwhile, the almond is just one of the 12 nuts in the international dried fruit goods basket, and it can be replaced with other nuts when prices are too high.
“This will be an opportunity for the Vietnamese cashew industry to promote export of cashew nuts to the Chinese market,” said Hiệp.
Relating to the pig industry, Deputy Chairman of Animal Husbandry Association of Việt Nam Phạm Đức Bình said that Vietnamese enterprises had promoted imports of pork due to the high price of pork in the country.
The price of dressed pork in Việt Nam ranges from VNĐ48,000-50,000 (US$2.07-$2.16) per kilo. Meanwhile, the price of slaughtered pork imported into the country is only US$1.5 per kilo. At this price, food processors are forced to increase the imports of pork to meet the production demand in the last months of the year.
“In that context, the US will be the market that businesses are aiming for, in hopes of gaining a cheaper import price due to the impact of the war. However, with the habit of preferring to consume imported goods, in the long run the Vietnamese livestock will lose on the domestic front,” said Bình.
Timber industry on watch
The list of goods between the US and China that are being taxed has no timber so Vietnamese businesses in this sector are not yet worried. But with the escalating trade tension, it’s possible that the two parties will impose taxes on more goods.
Vice Chairman of Vietfores Nguyễn Tôn Quyền said that the export value of Vietnamese wood products to the US market is still relatively high, accounting for 30 per cent of the total forest export turnover in the first six months of this year, equivalent to $4.3 billion.
Quyền said at this point, export signals to the US market remained stable and exporters had signed orders for this year.
“If the US put China’s wood products on the list, there is a risk of China moving goods to Việt Nam. At present, there are many Chinese foreign investment enterprises operating in Việt Nam, while Việt Nam is exporting a lot of timber and wood products to the US,” said Quyền.
Cao Chí Công, Deputy Director General of Forestry Department under the Ministry of Agriculture and Rural Development (MARD), said MARD and the Ministry of Industry and Trade had set up long-term solutions, not allowing Chinese businesses or other countries to view Việt Nam as a transit point for furniture exports to the US.
The ongoing US-China trade war will greatly impact the structure of the world economy in the future, causing damage but also generating indirect opportunities for countries where the economy relies heavily on agricultural production like Việt Nam.
According to head of the Việt Nam Cashew Association’s Trade Promotion Division Trần Văn Hiệp, although it is still quite early to assess the impact of the US-China trade war, it’s possible that Vietnamese cashews may benefit from this war.
Hiệp said the US was now one of the world’s leading almond exporters. Therefore, if China imposed a tax on this product, it would certainly affect US almond exports. Meanwhile, the almond is just one of the 12 nuts in the international dried fruit goods basket, and it can be replaced with other nuts when prices are too high.
“This will be an opportunity for the Vietnamese cashew industry to promote export of cashew nuts to the Chinese market,” said Hiệp.
Relating to the pig industry, Deputy Chairman of Animal Husbandry Association of Việt Nam Phạm Đức Bình said that Vietnamese enterprises had promoted imports of pork due to the high price of pork in the country.
The price of dressed pork in Việt Nam ranges from VNĐ48,000-50,000 (US$2.07-$2.16) per kilo. Meanwhile, the price of slaughtered pork imported into the country is only US$1.5 per kilo. At this price, food processors are forced to increase the imports of pork to meet the production demand in the last months of the year.
“In that context, the US will be the market that businesses are aiming for, in hopes of gaining a cheaper import price due to the impact of the war. However, with the habit of preferring to consume imported goods, in the long run the Vietnamese livestock will lose on the domestic front,” said Bình.
Timber industry on watch
The list of goods between the US and China that are being taxed has no timber so Vietnamese businesses in this sector are not yet worried. But with the escalating trade tension, it’s possible that the two parties will impose taxes on more goods.
Vice Chairman of Vietfores Nguyễn Tôn Quyền said that the export value of Vietnamese wood products to the US market is still relatively high, accounting for 30 per cent of the total forest export turnover in the first six months of this year, equivalent to $4.3 billion.
Quyền said at this point, export signals to the US market remained stable and exporters had signed orders for this year.
“If the US put China’s wood products on the list, there is a risk of China moving goods to Việt Nam. At present, there are many Chinese foreign investment enterprises operating in Việt Nam, while Việt Nam is exporting a lot of timber and wood products to the US,” said Quyền.
Cao Chí Công, Deputy Director General of Forestry Department under the Ministry of Agriculture and Rural Development (MARD), said MARD and the Ministry of Industry and Trade had set up long-term solutions, not allowing Chinese businesses or other countries to view Việt Nam as a transit point for furniture exports to the US.
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