Many rice farmers in An Giang Province enjoyed profits of up to 40 percent after several years of cooperating with a Japanese company that offered them a stable price for their crops.
Compared to farmers in the Mekong Delta who are preyed upon by shifty traders and crushing debts, the partners of the Angimex-Kikotu Company have a much better story to tell.
The cooperation between the An Giang Farmers’ Association and the company started in 2009.
This year, Japanese rice cultivation expanded to 2,330 hectares (4,942 acres) in the provincial capital Long Xuyen Town and three outlying districts: Thoai Son, Tri Ton and Chau Thanh.
Around 16,000 tons of rice resulted from three crops (winter-spring, summer-fall, and fall-winter), generating VND1.2 trillion (US$56.42 million) and leaving each participating household a profit of between 35-40 percent.
The association and the company agreed on prices of VND5,800-6,300 (27-30 cents) a kilogram of fresh stems and VND7,500-8,600 (35-40 cents) per kilogram of dried and processed grain.
Guaranteed, stable income was what convinced Nguyen Loi Duc, a local farmer, to join the project with 30 hectares of his field.
“They provide the seeds, they cover the output. I don't have to worry that prices will plunge like with other Vietnamese varieties,” Duc said.
The company meets with the farmers at the start of every crop to discuss prices, the varieties to be planted, as well as specific technical demands and cultivation parameters.
Nguyen Van Binh said he really appreciates being able to know he can count on a stable year-round price, before he begins work.
Binh said switching to Japanese rice has earned him an extra VND1-2 million per hectare.
He recently rented an extra 20 hectares to plant the next winter-spring crop, which he expects to earn him more than VND35 million ($1,650).
Good work also earns the farmers cash rewards.
Tran Van Ngoc, a participating farmer, said if a crop exceeds the company's quality standards, he becomes eligible for bonuses that range between VND100,000 and VND500,000 ($4.7-23) per kilogram.
Ngoc says he's gotten a bonus for every crop, except for one that was addled by an unusual insect attack.
Nguyen Thanh An said that planting Japanese rice is more difficult than Vietnamese rice but really pays off.
“With some experience, you can earn bigger profit and not worry about whether or not your harvest will be bought,” An said.
“More people just keep joining this company and bulking up their fields. I’ve seen no one leave.”
Akira Omori, deputy director of Angimex-Kitoku, said the company has built some additional warehouses in Thoai Son District this year to accommodate growing output.
"With some experience, you can earn bigger profit and not worry about whether or not your harvest will be bought."
-- Nguyen Thanh An, a farmer in An Giang Province.
A member of An Giang Farmers Association said the company began approaching local farmers in 2000, many of whom were initially skeptical and refused to join.
At that time, Japanese rice only occupied 200 to 400 hectares in the province.
But since the association stepped in as a middleman, more than 4,000 farmers have joined.
Right way for rice
Experts familiar with the issue say that the cooperation in An Giang has proven to be a win-win.
Bui Chi Buu, former director of the Southern Agriculture Science Institute, said Japanese people started to invest in rice cultivation in Vietnam at least 20 years ago.
“They'd bring the rice back home or export to another country from Vietnam at $800-1,000 a ton. Although the amount was not much, their profit was high,” Buu said.
Nguyen Quoc Vong, another agricultural expert, said Japanese rice can be used to make sake and various rice products.
“The rice planted in Vietnam isn't just exported back to Japan. The demand for their rice is very high in many other countries and their domestic output just can't keep up,” Vong said.
Japanese rice production in An Giang has fostered a sustainable, high-quality approach to agriculture, he said.
Japanese rice sells for up to $1,200 a ton abroad, around three times the export price of Vietnamese rice, he added.
Vong said the ministry of agriculture and food businesses in Vietnam should go out and bring more such businesses home to help local farmers.
Japanese rice is being cultivated on a large scale in Thailand and India which enjoy proper government support for high-tech agriculture.
Vietnam should offer the same incentives, he said.
On Thursday, Tuoi Tre (Youth) newspaper quoted Nguyen Trung Dung, trade counselor of the Vietnamese embassy in Japan, that Japan’s aging population has a dwindling agricultural workforce.
For that reason, Vietnam has become an ideal alternative food source since nearly 70 percent of its youthful population resides in rural areas.
Meanwhile, Vietnam is significantly behind in terms of its cultivation, distribution and preservation technologies, all of which Japan can help develop.
“The two countries apparently complement each other ideally,” Dung said.