Three factors make Vietnamese cassava slump in China

Although China is still the largest exporter of cassava and cassava products from Vietnam, the export of this commodity to China has been declining sharply since the beginning of the year compared to 2017.

Cassava exports to China reduces both in volume and value. Source: internet

The latest report by the Department of Agro-product Processing and Market Development (MARD) shows that in the first eleven months, cassava and cassava products exports were estimated at 3.4 million tons and 905.2 million USD, decreased by 3.93% in volume and 0.45% in value compared to the same period in 2017.

China is still the largest importer of cassava and cassava products from Vietnam with 2.8 million tons in the first ten months, occupying 88% of total exports. However, it is worth noting that exports to this market decreased compared to 2017, by 10.9% in volume and 12.3% in value. In addition, the average cassava export price of Vietnam to China in 2018 also decreased slightly at 1.69%

Department of Agro Product Processing and Market Development analyzed: This decline is affected by three main factors.

Firstly, China discharges corn stocks for animal feed and industry, but at the same time, eliminates price support for imported maize, which allows domestic maize prices to be able to compete against imported alternatives, such as sliced cassava product.

Secondly, the demand in the Chinese market fell because many Chinese factories bought enough quantities for the following months when the volume of primary purchases from Thailand earlier accrued.

Thirdly, the exchange rate (CNY/VND) decrease, variability is 3,360 per CNY because the CNY continued to depreciate against the U.S. dollar. This is detrimental to cross-border export transactions.

Some experts estimate: In fact, cassava is one of the agricultural products export to reach a turnover of billion dollars a year, but so far there is almost no policy to focus on development. In order to be able to sustainably develop the production and export of cassava, to reduce dependence on certain export markets, many producers and exporters of cassava recommend to formulate a policy of national development with Cassava, support the development of cassava in a methodical way