Building a national brand for Vietnamese rice: Better late than never.

With a tradition of rice cultivation spanning thousands of years, rice is not only the staple food but also a cultural symbol of Vietnam; the rice plant and its grains are present in every aspect of socio-economic life. Therefore, starting to build a national brand for Vietnamese rice now may be late, but better late than never.

Has the "golden seed" yielded gold?

According to statistics, Vietnam currently has 4.1 million hectares of rice-growing land, of which the Mekong Delta accounts for 53%. In 2014, total rice production reached 45 million tons, with exports exceeding 6.3 million tons, generating revenue of US$2.93 billion. Currently, Vietnam ranks third in the world for rice exports, after India and Thailand.

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Mr. Vo Thanh Do, Deputy Director of the Department of Agricultural, Forestry, and Fisheries Processing and Salt Production (Ministry of Agriculture and Rural Development), noted that despite achieving many outstanding accomplishments in the past period, the Vietnamese rice industry is facing many challenges such as: production is mainly on a small-scale, fragmented, and individual household level (over 85% of households have a scale of less than 0.5 hectares/household). Meanwhile, the organization of production on a cooperative, group, and contract farming scale is limited, leading to difficulties in quality management and unstable income for farmers. The rice variety structure is diverse but lacks key, high-quality varieties to develop flagship products and access international markets.

Vietnam's rice export market is currently in the mid- to low-end segment, with high-quality rice accounting for a low proportion of exports. There are currently over 200 medium and large-sized enterprises involved in the rice trade system, but the use of branding in the market, especially in the export market, remains very limited.

"In the context of increasingly fierce competition, besides traditional rivals, Vietnam also has to compete with potential rivals such as Cambodia and Myanmar. The competitive pressure on Vietnamese rice is not only about price and quality, but building a brand, maintaining reputation, and gaining the trust of the world market are urgent and vital requirements," Mr. Do said.

Based on his experience in rice export, Mr. Le Thanh Khiem, Deputy Director of Tien Giang Food Company, believes that the lack of a brand is causing Vietnam's rice to suffer double losses. For example, Thailand focuses on developing certain specific varieties, while Vietnam has yet to select a variety with long-term stability; our varieties are often only produced for a short period before degenerating. “Seed production plays a crucial role in brand building. If we want to build a rice brand, we can select certain varieties to preserve their genes. Furthermore, the practice of mixing many different rice varieties is the biggest limitation in building a brand for Vietnamese rice,” Mr. Khiem stated.

Representatives from the Southern Food Corporation acknowledged that the promotional and marketing activities of the corporation's units are still very limited, failing to create horizontal linkages between units to strongly develop packaged rice products; and not paying enough attention to selecting high-quality rice varieties to avoid situations where products have to be discontinued shortly after entering the market.

Businesses are the entities involved.

Sharing his experience in building his company's brand, Mr. Cao Tuan Nam, Chairman of the Board of Directors of Thap Muoi Clean Agriculture Development Co., Ltd. (Dong Thap), said that the company is investing in organic rice production, targeting high-end markets, using Jasmine rice varieties from the Mekong Delta Rice Research Institute, and producing on large-scale model fields using leased land from farmers. The product is aimed at the South African and Madagascar markets.

The project to develop the Vietnamese rice brand aims to ensure that by 2020, the image of Vietnamese rice is widely promoted and introduced domestically and to at least 20 export markets.

Currently, Tien Giang Food Company has also built 10 of its own rice brands, which have been recognized by the Intellectual Property Office. However, these are only the trademarks of a single company. According to Mr. Khiem, to shorten the process of building a national rice brand, we should utilize existing varieties from businesses and simultaneously develop the market. Besides exports, more attention should be paid to the domestic market, as the domestic market consumes 30-40% of the rice produced.

"In brand building, the State must play the role of conductor, providing policies to support businesses so that they can find markets, because a brand only exists when there is a market," Mr. Khiem said.

According to Mr. Vo Thanh Do, businesses must be identified as the key players in brand building. The State needs specific policies and solutions to encourage and support businesses to proactively and effectively participate in this process.

Mr. AK Gupta, Director of the Basmati Export Development Fund, Agricultural Products Export Development Authority (APEDA), Ministry of Commerce and Industry of India, shared his experience: to make India's famous rice products known to global consumers, the country conducts regional and national promotion with a common policy, with reliable and high-quality suppliers; prioritizes trade promotion and development of specialty rice; and builds geographical indications and trademarks. To date, India has famous rice brands such as Navara, Palakakadan Matta, Pokkali, Wayanad Jeeraksala, Wayanad Gandhakasala, Kala Namak, and Kaipad. India's Bastima rice exports in 2013-2014 reached 3.75 million tons, while other rice varieties totaled 7.15 million tons. Production in 2014-2015 is expected to reach approximately 3.7 million tons of Basmati rice and 8.23 ​​million tons of other rice varieties.

"Besides the role of government agencies, businesses involved in production and trade play a particularly significant role in building and developing rice brands," Mr. Gupta affirmed.

Meanwhile, in Thailand, the supply chain from farm to market is shortened because farmers can market their products themselves through cooperatives instead of going through middlemen. As a result, farmers can benefit by 20% or even 100% if they create different added value for the same product.

Although not as rich in tradition as Vietnam, India has managed to build its own Bastima rice brand; Thailand is famous for its Jasmine rice; and Vietnam, while always proud of its many specialty rice varieties, has yet to be recognized on the world brand map.

According to Mr. Tran Viet Thanh, Deputy Minister of Science and Technology, in May 2015, the Prime Minister approved the project to build a national brand for Vietnamese rice. This is an important, comprehensive production project, assigned to various ministries and agencies for coordinated development. The Ministry of Agriculture and Rural Development is assigned to lead the project, with the Ministry of Industry and Trade, the Ministry of Science and Technology, and other ministries and agencies coordinating its implementation.

Mr. Thanh argued that creating a brand is difficult, but ensuring the long-term, stable existence of a quality value chain for that brand is even more challenging. Currently, the Ministry of Science and Technology has developed research programs and projects related to creating high-quality rice varieties and modern, advanced machinery and equipment to streamline the rice production process; and is continuing to develop and refine the Vietnamese standards and regulations for rice exports.

“National branding is not a new issue, but Vietnamese rice is the first agricultural product to approach it in this way. In the past, we focused on building and developing intellectual property based on the advantages of local and regional specialties, leveraging the strengths of Vietnamese agriculture. However, for products with large-scale commercial production like rice, building a national brand is necessary to create an image, position, and promote trade in the international market. Secondly, a national brand can become a destination, a convergence of state policies with a holistic approach from production, processing, and trade, promoting the comprehensive application of science and technology, and serving as a basis for the development and sustainability of the industry to capture and expand markets,” Mr. Thanh emphasized.

Although not as rich in tradition as Vietnam, India has successfully built its own Bastima rice brand, Thailand is famous for its Jasmine rice, while Vietnam, always proud of its many specialty rice varieties, has yet to be recognized on the world brand map. Therefore, raising the issue of building a national rice brand now may be too late, but it is something that must be done immediately if we do not want to lose our third-place position.

The project for developing the Vietnamese rice brand until 2020, with a vision to 2030, was approved by the Prime Minister on May 21, 2015. The goal is to widely promote and introduce the image of Vietnamese rice domestically and to at least 20 export markets by 2020; to protect the national rice brand under the form of a certification mark in Vietnam and at least 50 countries; and to achieve 20% of exported rice production bearing the Vietnamese rice brand.

By 2030, rice-producing regions for export will be stable, efficient, and sustainable, making Vietnamese rice a leading global brand in terms of quality and food safety; striving for 50% of exported rice to bear the Vietnamese rice brand, with 30% of total exported rice being fragrant and specialty rice varieties.

According to Kinhtenongthon