From production unit codes to new approach in value chain: PPPD

For many years, numerous localities have begun their export journey by establishing cooperatives, cooperative groups, or concentrated production areas to meet the requirements for obtaining production unit codes. However, according to Deputy Minister of Agriculture and Environment Nguyen Hoang Hiep, this approach needs to change. Rather than forming linkages to obtain a production unit code, it is the code itself that will encourage farmers to join forces if they wish to enter export markets.

Speaking at the conference on July 23 reviewing the agricultural sector’s performance in the first six months of 2026 and outlining priorities for the second half of the year, the Deputy Minister called for a shift in regulatory thinking. He emphasized reducing administrative procedures and moving toward a system based on data management, traceability, and post-market oversight, allowing market demand to become the driving force behind the development of large-scale raw material production regions.

Moving beyond administrative procedures to build linkages

For many years, the production unit code has been regarded as a "passport" for agricultural exports. To ship products to China, the EU, the United States, and many other markets, localities have had to organize production areas, prepare documentation, and meet a wide range of technical requirements before a code could be issued.

"We should no longer treat the establishment of cooperatives or production organizations as a prerequisite for obtaining a production unit code," Deputy Minister Nguyen Hoang Hiep said. Instead, he proposed that authorities issue production unit codes at farmers' request through streamlined administrative procedures.

According to the Plant Production and Protection Department (PPPD), this approach is already supported by practical experience. As of mid-July 2026, local authorities had issued 481 production unit codes and 349 packing facility codes, supporting exports of a wide range of fruits, including durian, bananas, pomelos, mangoes, jackfruit, dragon fruit, and coconuts, to markets such as China, the United States, South Korea, the EU, New Zealand, and others.

At the same time, the Department has submitted a proposal to the Government for a resolution to simplify administrative procedures related to production unit codes and packing facilities. No longer serving as a tool for a single market or commodity, the production unit code is gradually becoming a core component of Viet Nam's agricultural export infrastructure.

However, expanding the number of production unit codes is only a necessary step. The real challenge lies in maintaining the quality of each production area after a code has been issued. During the first six months of 2026, the number of warnings issued for exported agricultural shipments increased by 56 cases compared with the same period in 2025. This underscores new requirements for raw material production areas. Beyond controlling residue levels, the entire production process must be managed consistently, from seed varieties, fertilizers, and crop protection products to cultivation records and traceability.

Alongside expanding the issuance of production unit codes, the PPPD has identified post-market oversight as a key priority in the coming period, working closely with local authorities to manage production areas rather than focusing solely on the issuance process.

When the market drives decisions

Using production unit codes as an example, Deputy Minister Nguyen Hoang Hiep called on the PPPD to fundamentally transform its regulatory approach. The ultimate goal of public administration, he said, should be to help farmers and businesses overcome production bottlenecks, expand market access, and enhance competitiveness.

In practice, the Department has already begun implementing these changes since early 2026. Administrative procedures have been significantly streamlined, reducing processing times by 47% and compliance costs by more than 34%. At the same time, the Department has been developing an industry-wide data platform linked to the national database to support digital governance and regulatory management.

Growing pressure from export markets has made this transformation even more urgent. Deputy Director General Nguyen Quoc Manh acknowledged that the second half of the year will be a decisive period for many key export commodities, with 60% to 75% of banana and durian export volumes expected during this time.

Climate-related risks also call for a new approach. El Niño is forecast to have a significant impact on the 2026-2027 winter-spring crop, while Arabica coffee-growing areas in Viet Nam's Northwest need more comprehensive assessments of the effects of frost, which typically occurs in five- to six-year cycles.

Perhaps for this reason, Deputy Minister Nguyen Hoang Hiep envisions a fundamental shift in the role of regulatory authorities, from acting primarily as licensing bodies to becoming architects of the "rules of the game" by providing data, identifying bottlenecks, and helping farmers adapt to increasingly stringent market standards.

In the first six months of 2026, the crop production sector's output value is estimated to have increased by 2.7%, exceeding the Ministry's target of 2.63%. Growth in the second quarter alone reached approximately 3%, with perennial crops continuing to serve as the main driver.

For industrial crops, Viet Nam currently has 758,000 hectares of coffee, with production estimated at approximately 2.116 million metric tons, up 5% year on year. The country also has 914,200 hectares of rubber, 299,000 hectares of cashew, and 128,100 hectares of tea.

In the agricultural input sector, fertilizer imports totaled approximately 1.67 million metric tons, valued at USD 552.8 million, down 33.4% from the same period last year. Meanwhile, fertilizer exports reached about 1.375 million metric tons, worth USD 735.1 million, an increase of 34.5%. For crop protection products, the PPPD registered 348 new products, including 30 biological products.