Policies required for more effective agricultural cooperatives

Outdated agricultural cooperative business models need to be replaced in order to bring farming products into local supermarkets and international markets, earning farmers higher income in the face of growing competition.

President of the Vietnam Fatherland Front (VFF) Central Committee Nguyen Thien Nhan made the remark at a conference to discuss policies for agricultural cooperatives hosted by the Ministry of Agriculture and Rural Development (MARD) in Hanoi on April 11.

The MARD recorded around 10,450 agricultural cooperatives last year operating in farming, animal husbandry, aquaculture, forestry, salt production and agricultural services, accounting for 50 percent of the total cooperatives nationwide. They were mostly concentrated in the Red River Delta, North Central Coast and Northeast regions.

Most of the cooperatives focus on supplying input materials for their members, such as varieties, equipment and fertilizers, and irrigation services while only 9 percent engaged in product distribution.

VFF President Nguyen Thien Nhan at the conference.

The ineffective performance led to persistently low incomes with just over one million VND (46.24 USD) per month in several areas.

There are also insufficient linkages between farmers and businesses. Even with successful links in the production of rice, beef, sugarcane, coffee and pepper in the Mekong Delta, only 10-15 percent of the total farming output was distributed by the cooperatives.

The current trend of developing agricultural value chains necessitates an increased role of cooperatives as a bridge between farmers and distribution businesses.

A representative from a cooperative in northern Lao Cai province urged the MARD to set VietGAP as the compulsory standard for agricultural production inside cooperatives and trade promotion groups to help farmers sell their products.

Under the Politburo resolution on developing new-style cooperatives in agriculture, fishery and trade villages, the MARD in coordination with the VFF and the Vietnam Farmers’ Union is discussing with local authorities and outstanding farmers in the Mekong Delta the establishment of pilot cooperative models, first of all in rice farming.

Meanwhile, pilot new-style cooperatives in animal breeding will be set up in some northern and southern provinces based on the successful models of the Quy Hien cooperative in the northern mountainous province of Lao Cai and the Dan Phuong cooperative in Hanoi.

Guidelines for the establishment of new-style fishery cooperatives will also be issued in June this year.