Farmers and businesses join hands in chili cultivation

Building the habit of value-chain production

Currently, horn chili prices across many localities in Can Tho have dropped sharply to only VND 4,000-6,000/kg, putting many farmers under pressure from potential losses.

Instead of continuing to accept the familiar cycle of bumper harvests followed by falling prices and complete dependence on traders as before, many chili farmers are gradually changing their production mindset. They are proactively seeking opportunities to collaborate with businesses to establish stable raw material zones and produce in accordance with clear standards and processes.

In Vinh Chau Ward, the Samaki Organic Agricultural Cooperative currently has around 30 chili-growing households and is also linked with many outside farmers to establish a horn chili raw material area covering approximately 50-60 hectares.

According to Mr. Thach Dil, Deputy Director of the cooperative, horn chili is highly suitable for the hot weather and sandy soil conditions in Vinh Chau. Farmers usually plant after the Lunar New Year and continue harvesting until before the rainy season. Thanks to the high, well-ventilated land and manageable pest conditions, horn chili yields range from around 2.5–3 tons per công.

With its bright red color, mild spicy flavor, slight pungency, and thick flesh, horn chili is particularly suitable for chili sauce processing. However, for many years, market outlets for this crop have relied mainly on traders at traditional markets, leading to significant price fluctuations. Mr Thach Dil said current prices are only around VND 4,000-6,000/kg, while farmers need prices above VND 8,000/kg to make a profit.

The Samaki Organic Agricultural Cooperative has developed plans to partner with TD Soc Trang Organic Rice Joint Stock Company, a business specializing in organic rice production that is now expanding into agricultural processing, beginning with the construction of a chili sauce processing factory that will require around 2,000 tons of raw materials annually.

More importantly, chili farmers are now beginning to consider organizing production to meet business requirements. Instead of buying freshly harvested chili directly from orchards in the traditional way, the company requires products to be pre-processed, graded, destemmed, and cleaned to meet Grade A standards.

This approach allows the cooperative to take advantage of available labor and services to increase the value of chili products. The company offers a package purchasing model, with minimum purchasing prices maintained at VND 12,000-13,000/kg depending on market conditions.

This model is creating a clear shift in farmers’ awareness. To join value-chain partnerships, farmers must pay attention to quality standards, planting schedules, cultivation procedures, product grading, and coordination with businesses.

Seeking partnerships for more professional production

Lieu Tu Commune currently has more than 20 hectares of yellow horn chili cultivated by 135 farming households. However, market outlets still mainly depend on traders or seed suppliers. Mr. Thach Sua, a farmer in Giong Chat Hamlet, said his family cultivates about 1,000 square meters of yellow-horn chili, with an average yield exceeding 1.4 tons per year.

About three months ago, chili prices reached as high as VND 70,000/kg, but have now fallen to around VND 20,000/kg. Although farmers can still earn profits because production costs are only around VND 10,000/kg, market volatility continues causing anxiety.

“If businesses guarantee purchases, market outlets and prices will become more stable. Chili farmers still prefer joining production partnerships”, Mr. Sua said.

Many farmers in Lieu Tu are now willing to switch from yellow horn chili to horn chili varieties to participate in building raw material zones for chili sauce processing enterprises.

According to Mr. Tram Du, General Director of TD Soc Trang Organic Rice Joint Stock Company, the company is investing in a chili processing factory in Soc Trang, expected to begin operations in May 2026 with annual demand for around 2,000 tons of raw materials. Since current raw material zones only meet around 50% of demand, the company hopes to expand partnerships with chili farmers in other localities.

What businesses need is not simply chili cultivation area but well-organized raw material zones. Therefore, the company has requested local authorities to support the creation of farmer lists, planting schedules, estimated yields, and harvesting timelines to proactively plan purchasing and payments.

Purchasing prices are also being offered under two options: fixed prices agreed at the beginning of the season or market-based purchasing prices, depending on farmers’ preferences.

From discussions among farmers, cooperatives, local authorities, and businesses, a very clear shift in production thinking is evident. While farmers previously relied mainly on experience, produced independently, and depended entirely on market fluctuations, many are now considering partnerships, product standardization, and organizing production according to enterprise demand.

This is not only a way for chili farmers to secure more stable market outlets but also a foundation for forming farmer groups capable of understanding markets, mastering production processes, proactively cooperating, and gradually participating more deeply in value chains.

According to Mr. Nguyen Van Huyen, Standing Vice Chairman of the People’s Committee of Lieu Tu Commune, local authorities have repeatedly invited businesses to discuss production partnerships and agricultural product purchasing arrangements for farmers. Although no official contracts have yet been signed, the local government hopes this will become a turning point in restructuring crop production in the area.

$ 1 = VND 26,391 - Source: Vietcombank.