ModernFarmerSS2#5| Tái cấu trúc chuỗi giá trị để kích hoạt tài chính xanh |Hùng Linh, Benjamin Brink

Key Concepts

• Fragmented Agriculture: Vietnam’s agricultural system is characterized by small, dispersed landholdings, hindering scalability and efficiency.
• Digital Infrastructure: A “data as infrastructure” platform is crucial for collecting, integrating, and providing valuable data services to farmers.
• ESG Compliance: Environmental, Social, and Governance standards are increasingly vital for accessing international markets and green financing.
• Platform-Based Approach: A step-by-step platform onboarding process incentivizes farmer participation by delivering tangible benefits at each stage.
• System Building vs. Control: Shifting from centralized value chain control to a collaborative “system building” model is key to long-term success.

Transforming Vietnamese Agriculture: Finance, Technology & Sustainability

This discussion centers on the systemic changes needed to modernize Vietnamese agriculture, enabling it to compete internationally and attract investment. The core challenge lies in the highly fragmented nature of the sector, with over 9 million households farming on average plots of less than 5,000 square meters, often in non-contiguous locations. This fragmentation impacts productivity, increases sourcing costs, and prevents scaling to meet large international orders, such as a 1 million ton rice contract.

The Need for Data & Digital Public Infrastructure

A fundamental solution proposed is the development of a “digital public infrastructure” – a “data as infrastructure” platform. This platform would collect, integrate, and provide data and software services to farmers, including weather information, soil analysis, market data, and traceability tools. This data will also be used to create credit scoring systems, improving farmers’ access to financing, where currently only 10% have access to the loans they need due to lack of collateral. The platform will function as a Data as a Service (DaaS) and Software as a Service (SaaS) model.

Financial Challenges & Green Finance

Financial bottlenecks extend beyond interest rates. The primary issue is establishing a trustworthy system for capital flow, requiring measurable, controllable, and reliable systems. The growing importance of Environmental, Social, and Governance (ESG) standards is highlighted, with compliance becoming crucial for accessing international markets and attracting investment. While green financing isn’t necessarily cheaper, it offers long-term benefits and access to a wider range of investors. Agrias aims to facilitate 1 trillion Vietnamese Dong in supply chain financing this year, with potential to increase to 10 trillion.

Upstream Intervention & Sustainable Practices

Investment in upstream interventions, such as the triogramma project (a biological pest control method), is vital. This reduces reliance on pesticides, improves community health, and enhances product quality, mitigating risks for investors. The successful export of Vietnamese agricultural products to Costco demonstrates the benefits of efficient logistics and just-in-time delivery. The organic sugar market, with prices three times higher than conventional sugar, exemplifies the economic benefits of ESG compliance.

Implementing ESG & Farmer Onboarding

Implementing ESG compliance is a complex undertaking. Agrias and Bumex utilize a multi-faceted approach, including hiring ESG advisors, employee training, and “demo farms” to showcase implemented technologies and standards. A key strategy is a platform-based approach designed to incrementally onboard farmers and SMEs, delivering tangible benefits at each stage of participation.

• Step 1: Basic farm and personal data input unlocks initial benefits.
• Step 2: Detailed data on inputs and transactions provides access to a platform connecting farmers with fertilizer vendors, functioning as an e-commerce platform.
• Step 3: Traceability data enables access to premium markets demanding verifiable sustainability.

A Continuous Improvement Journey & System Building

The platform isn’t a pass/fail test, but a continuous improvement journey. Farmers can analyze their own data, identify strengths and weaknesses, and learn from their experiences, supported by data on weather and agronomic knowledge. The discussion emphasizes a shift from traditional, centrally controlled value chains to a collaborative “system building” model, identifying core areas to own (quality, ESG standards) while leveraging external expertise. This fosters a win-win scenario where Agrias benefits from broader participation and farmers gain access to valuable information and resources. Australian farmers achieving yields 10 times higher per square meter/hectare serve as a motivational benchmark.

Conclusion

The modernization of Vietnamese agriculture requires a fundamental shift towards data-driven decision-making, ESG compliance, and collaborative system building. The development of a robust digital public infrastructure, coupled with a platform-based approach to farmer onboarding, is crucial for unlocking the sector’s potential and ensuring its long-term sustainability and competitiveness in the global market. Embracing technology, digitalization, and ESG standards is not merely a compliance requirement but a strategic opportunity for growth.