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BASF sets up crop protection business in Vietnam
German’s chemical company BASF on Wednesday said it would sell its crop protection drugs directly to Vietnamese farmers rather than via local distributors.
Leon Van Mullekom, Business Area Director for Crop Protection ASEAN at BASF, said the direct selling is aimed to ensure efficient use of such drugs as the firm will provide technical training for farmers.
BASF will set up an expert team to train local farmers. The company currently focuses on providing drugs for coffee, rice and some other crops in the Central Highlands and the Mekong Delta.
Raman Ramachandran, BASF’s Senior Vice President for Crop Protection Asia-Pacific, said that in the coming time BASF would consider setting up AgSolution Farm as a model farm to introduce agricultural solutions to farmers, distributors and BASF staff. BASF has opened such farms in Thailand, the Philippines and Indonesia.
Talking about BASF’s plan in the Vietnamese market, a member of the Vietnam Pesticide Association (VIPA) told the Daily that local companies selling crop protection drugs were facing market share decline when foreign large companies sold their products directly to farmers rather than via distributors.
“Currently, 50% of the market for crop protection drugs is held by seven foreign-invested companies while the rest belongs to 300 local ones. And now with the direct selling of BASF, local companies will lose their market share, which is just a matter of time,” he said.
Regarding the model farm, according to VIPA, this is the strategy which only some large companies like BASF are capable of carrying out while others cannot due to limited financial capabilities.
According to the Ministry of Agriculture and Rural Development, Vietnam’s import value of pesticides and materials amounted to US$454 million in the January-July period, showing a year-on-year rise of 15.6%, with over half imported from China. Besides, around 90% of the crop protection drugs available on the market uses imported materials.
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