Vietnam a fertile land for agritech firms

At the end of May 2023, True Digital Group (TDG) Vietnam JSC, a subsidiary of True Corporation of Thailand’s CP Group, announced a strategic partnership in Vietnam market with Techcoop.

The focus of the Ministry of Agriculture and Rural Development from 2022 to 2025 on piloting the building of areas of agricultural and forestry raw materials to meet domestic consumption and export goals is what made TDG want to take part.

"We know that this is one of the most important goals of Vietnam's agricultural sector's plan for growth: to increase productivity, product quality, and the value of agricultural exports to the rest of the world", said Ngo Anh Tuyen, general director of TDG.

There have been a lot of agricultural tech firms in Vietnam’s farming business. An American company called Koidra which uses artificial intelligence in farming also entered the Vietnamese market earlier this year.

MimosaTEK, Koina, Foodmap, and Kamereo (Japan) before it. These firms operate throughout Vietnam's agricultural supply chain. MimosaTEK, Koina, and Koidra increase crop quality through technology, while Foodmap and Kamereo buy, transport, and sell food in stores.

Most startups focused on crop quality 10 years ago. Farmers worry primarily about product quantity, so this had little impact.

Asia's first agritech unicorn, Cropin, digitizes 5 million hectares of arable land and over 7 million families. TDG deploys Cropin only in Southeast Asia. Cropin manages crops in over 92 countries with technology. TDG and Cropin bring the Group's superior technology ecosystem TrueFarm to Vietnam to assist businesses customize global solutions.

TDG is the only company in the current agricultural supply chain that is involved in every step, from growing crops to selling them in bulk. This company wants to work with agricultural businesses that are in the middle and big sizes.

The main thing that makes TDG stand out in the market is that it offers an all-in-one answer for agribusiness. In terms of technology, in particular, the TDG sales network will take part, and the Techcoop partner will give out the other capital for farm production.

Decree No. 57/2018/ND-CP's effectiveness in attracting investment and rural development is encouraging. Four projects receiving $840 million in foreign loans were approved by the Ministry of Agriculture and Rural Development in 2022. In the coming months, the agency will engage with companies to propose 14 additional projects worth $3.2 billion.

Tuyen of TDG argues that the growing trend of livestreaming garden sales is a possibility for the agricultural industry. Example: China. Since the outbreak, exporting has been difficult, but the country's top e-commerce sites have helped farmers sell their produce. expenditure domestically.

Pinduoduo, Alibaba, JD.com, and Taobao have initiated campaigns for farmers to sell agricultural items livestreaming from the yard. In September 2022, Taobao staged 200,000 livestream agriculture sales events that garnered 700 million views and 4 million orders, according to its latest report. Taobao's internal analysis showed that selling via livestream makes farmers 8 times more money. This is a good example for agricultural nations like Thailand. Bangkok Bank EVP Suwatchai Songwanich remarked, "Livestream is the future of agriculture."

Mr. Tuyen of TDG said that Vietnam has a lot of reasons to move toward this trend. Vietnam has the highest e-commerce usage rate in Southeast Asia, which means that people are already used to shopping and paying for things online.

The biggest problem right now is that not many farms know how to use marketing technology or have a skilled livestream sales team. TDG is also good at this. In general, it's too early to tell if TDG's plan to offer all-in-one services for farm production businesses in Vietnam will work, but the fact that more and more agritech companies are getting involved is a good sign.

Usually, to make a unicorn, which is an unlisted business worth $1 billion or more, you need a standard market that is big and has room to grow. Vietnam's agriculture exports reached more than $53 billion in 2022, but in the last 10 years, there were only a few startups in this field, and the total capital announced was less than $200 million.

TDG and its partners have done their own calculations that show if digitization works, Vietnam's farming exports could double, which would be worth more than $100 billion. "In addition to the export market, we also target domestic businesses to bring agricultural products to consumers through communication and social commerce solutions," Tuyen said.