Credit capital helps farmers improve coconut farming efficiency

In recent years, coconuts have no longer been just a crop for poverty reduction but have become one of Viet Nam’s key agricultural products. Information from the Viet Nam Coconut Association shows that the total export value of coconut-based products surpassed USD 1 billion in 2024.

Mr. Cao Ba Dang Khoa, Secretary-General of the Viet Nam Coconut Association, said, “Aiming to match the coconut’s new position in Viet Nam’s agricultural and economic landscape, improve competitiveness for this unique fruit and coconut products globally, standardization must begin at the farming stage. Farmers require training to enhance cultivation skills and record detailed, transparent farming practices using agricultural logbooks.”

Given current market dynamics, the Viet Nam Coconut Association has launched a targeted credit program for coconut growers. The goal of this program is to standardize cultivation, elevate product quality, and stabilize pricing, thereby attracting investment from traders and processors.

To carry out the program, the Viet Nam Coconut Association partnered with the agriculture sector and Agribank to pilot it first in three Mekong Delta localities with large coconut-growing areas: Dong Thap, Vinh Long, and Can Tho city.

Phase 1 is scheduled for 2025 and aims to enable 2,700 coconut-growing households in these three localities to access credit packages. This will encourage farmers to invest in production and meet quality standards, thus improving the overall quality of Mekong Delta coconuts.

Agribank Ben Tre Branch is currently promoting this pilot credit policy for the coconut sector. According to Nguyen Thi My Hoa, Deputy Director of the branch, Agribank provides credit products for individuals, households, and businesses engaged in coconut-related activities, including planting, caring for coconut orchards, rehabilitating old orchards, purchasing, processing, and exporting coconut-based products.

In general, Agribank Ben Tre Branch has so far provided more than VND 1,400 billion in credit to over 7,200 customers. The branch has successfully implemented a credit package linking loans through value chains, currently providing loans to eight value chains.

In Viet Nam's coconut sector specifically, the credit program has enabled farmers to expand investment in and better care for their coconut orchards. Credit financing has also helped farmers apply science and technology to reduce the risk of disease. It has also encouraged households to participate proactively in value-chain linkages coordinated between Agribank Ben Tre Branch and coconut industry enterprises in the region.

Thanks to their participation in value chains, Ben Tre farmers have detected signs of stability in coconut selling prices, as they are no longer pressured by third-party traders. In the credit investment program for the coconut industry, capital from Agribank has opened up more options for coconut farmers, thereby increasing the productivity of their coconut orchards by 20-30%.

The coconut sector has been growing strongly in recent years, becoming a "billion-dollar" industry. Despite the uptrend, many coconut farmers' lives remain difficult. Due to a lack of capital, many farmers' orchards are low-productive and vulnerable to pests and diseases. Coconut farmers mostly operate on a small scale, so the output is often met with unstable market prices. 

“In the past, the cooperative's coconut farmers faced many difficulties, especially in terms of capital to invest in coconut trees. Some households have saved a small amount of money after growing coconut trees for a period. But such a small amount of capital is not enough to develop their family's orchards,” said Pham Van Tanh, Director of An Thoi Coconut Cooperative (Vinh Long).

Thanks to capital support from the credit program, many farming households have been able to intercrop coconut with suitable crops and livestock, thereby increasing their family's income. Several households boldly invest in water-saving irrigation systems or adopt reasonable fertilization methods, thereby increasing the productivity of coconut orchards.

With capital in hand, many farmers have upgraded their coconut orchards by replacing old varieties with higher-yielding, higher-quality varieties, or renovating old orchards. Some households have expanded the coconut growing area.

"In addition to support in credit capital, Agribank also cooperates with localities, cooperatives, and businesses to organize a product consumption link chains for coconut farmers, thereby helping people gain stable output," said Director Tanh.