1 Ministry of Agriculture & Rural Development CARD Project 050/04VIE Improvement of export and domestic markets for Vietnamese fruit through improved post-harvest and supply chain management Milestone Report 10: SOFRI Capacity Development Date June 2009 1 Table of Contents 1 Institute Information 3 2 Contact Officer(s) 4 3 Project Abstract 5 4 Executive Summary 5 4.1 Introduction & Background 8 4.2 Implementation Highlights 9 4.3 Southern Sub-Institution of Agricultural Engineering and Postharvest Technology (SIAEP) 10 4.4 Southern Fruit Research Institute (SOFRI) 12 4.5 Post CARD Project Implementation and capacity building for SIAEP and SOFRI 13 5 Mango Groups 44 5.1 Cat Hoa Loc Farmers Group (Co-operative) 44 5.1.1 Brief history of the Cat Hoa Loc Co-operative 44 5.1.2 Cat Hoa Loc Co-operative Mission 44 5.2 Cam Thanh Farmer Group 44 5.2.1 Brief history of the Cam Thanh Farmer Group 44 5.2.2 Cam Thanh Farmer Group Mission 44 5.3 Viet Hung Company (Private Company) 45 5.3.1 Brief History of the Viet Hung Company 45 6 Pomelo Groups 45 6.1 My Hoa Farmers Group 45 6.1.1 Brief history of the My Hoa Farmer Group 45 6.2 Hoang Gia Pomelo Company 45 6.2.1 Brief history of the Hoan Gia Pomelo Group 45 7 Practices before CARD project implementation 46 7.1.1 Supply/value chian analysis, strategic planning methodology and quality control 46 7.2 Pre-harvest Aspects Identified 46 7.2.1 Orchard design for mango and pomelo 46 7.2.2 Canopy management for pomelo and mango 47 7.2.3 Pest and disease control for mango and pomelo 47 7.3 Harvesting practices for mango 49 7.3.1 Maturity indicators for mango 49 8 Postharvest Aspects for pomelo and mango 49 8.1 Fruit grading and sorting for pomelo 49 8.1.1 Fruit grading and sorting for mango 50 9 Practices after CARD project implementation 52 9.1.1 Top 5 Priority for the Mango Strategic Plan are: 52 9.1.2 Top 5 Priority for the Pomelo Strategic Plan are: 52 9.1.3 Pre-harvest capacity building of mango and pomelo farmers 53 9.1.4 Postharvest capacity building for mango and pomelo farmers 62 9.1.5 Supply/value chain capacity building for mango and pomelo farmres 70 10 Examples of farmer groups and capacity built by CARD projects and benefits obtained 77 10.1 Mango 77 2 10.2 Pomelo 80 11 Environment issues 82 12 Conclusions 83 12.1 At the Grower/Farmer level: 83 12.2 At the collector, trader and wholesaler level: 84 12.3 Options 84 12.4 Sustainability 85 13 Appendix 1 86 3 1 Institute Information Project Name Improvement of export and domestic markets for Vietnamese fruit through improved post-harvest and supply chain management. Vietnamese Institution Southern Sub-Institute of Agricultural Engineering and Post-Harvest Technology (SIAEP) Vietnamese Project Team Leader Mr Nguyen Duy Duc, M. Eng. Australian Organisation Queensland Department of Primary Industries and Fisheries (DPI & F) Australian Personnel Mr. Robert Nissen Dr. Peter Hofman Mr Brett Tucker Mr. Roland Holmes Date commenced September 2006 Completion date (original) May 2008 Completion date (revised) December 2008 Reporting period Milestone Report 7 4 2 Contact Officer(s) In Australia: Team Leader Name: Mr. Robert Nissen Telephone: +61 07 54449631 Position: Project Leader Fax: +61 07 54412235 Organisation Queensland Department of Primary Industries and Fisheries (DPI & F) Email: bob.nissen@dpi.qld.gov.au In Australia: Administrative contact Name: Michelle Robbins Telephone: +61 07 3346 2711 Position: Senior Planning Officer (Emerging Technologies) Fax: +61 07 3346 2727 Organisation Queensland Department of Primary Industries and Fisheries (DPI & F) Email: michelle.robbins@dpi.qld.gov.au In Vietnam Name: Mr Nguyen Duy Duc, Telephone: +84 (8) 8481151 Position: Director SIAEP Fax: +84 (8) 8438842 Organisation Southern Sub-Institute of Agricultural Engineering and Post-Harvest Technology (SIAEP) Email: siaep@hcm.vnn.vn 5 3 Project Abstract 4 Executive Summary Having a good understanding of what constitutes a supply/value chain is critical to it understanding how they operate, how to analyse the chain and how to make changes to the chain to benefit all the chain members. Many individual companies adopt and adapt what they consider are key elements or building blocks of a supply/value chain. They put these building blocks together to suit their particular needs without considering all the necessary supply/value chain elements to be successful. Supply/value chain participants today must be highly adaptable, as inflexible participants will not generate added value and will be forced out of their industry. These participants must adopt new supply/value chain strategies that will deliver value for money to their customers and ultimately, the end consumer. Before the commencement of the CARD Project, SIAEP staff skills were confined to postharvest aspects. They had some knowledge of pre-harvest practices, e.g. crop physiology, agronomy and cultural methodology. Some of the SOFRI staff in the postharvest section were reasonably knowledgeable of the postharvest aspects of mango and pomelo fruit and methods to maintain shelf-life in Vietnam under Vietnamese conditions. Traditional farming practices based on planting seedling mango trees with no canopy management is significantly affecting productivity, control of pests and diseases, fruit quality and shelf-life of mango fruit. The types, effectiveness and usage of chemicals in the Mekong Delta of Vietnam is of major concern. The fruit industry in Vietnam has a great potential and plays an important role in agricultural production. In 2003, Vietnam exported US$43 million of high value fruit to high-income countries and imported US$14 million of fruit and vegetables. Vietnam is experiencing difficulties in competing with other Asian nations in export markets and its own domestic market, especially with China and Thailand. This suggests that Vietnam’s horticultural industries require substantial development to be globally competitive. Vietnamese consumers are demanding safer and higher quality fruit. This project has identified key pre-and post-harvest technology gaps that reduce product quality, safety and consistency. Targeted training programs are focusing on the total supply chain and are providing benefits by helping to implement quality management systems and GAP systems at the village level providing greater employment for the farming community. This project embraces the five CARD strategies for rural development; and in particular; strategies to increase production and competitiveness of agricultural systems; reduce poverty and vulnerability, and increase stakeholder participation whilst ensuring sustainability. 6 Traditional harvesting practices based on no standardised maturity indicators, process to eliminated fruit damage, handling, packaging and transportation and the lack of postharvest practices and development of effective, efficient value/supply chains is seriously affecting the development of the domestic and export markets for Vietnam. To build knowledge, SIAEP and SOFRI along with the Australian team developed and produced 5 booklets for Vietnamese farmers as best practice GAP guides. These were:- • Mango Cultivation Handbook • Mango Pest Quick Guide Booklet • Mango Disease Quick Guide Booklet • Pomelo Cultivation Handbook • Pomelo Pest and Disease Quick Guide Booklet By developing these manuals and booklets knowledge for both SIAEP and SOFRI was substantially increased in the best practice and GAP pre-harvest factors. Also SIAEP and SOFRI staff knowledge increased in how these pre-harvest factors affect the post-harvest fruit quality, shelf-life and saleability of mango and pomelo Participatory action learning training and capacity building in supply/value chains was conducted by the Australian team for SIAEP and SOFRI. Staff of SIAEP and SOFRI, assisted by the Australian team members then trained farmers and farmer groups to increase their knowledge of supply chains and technical processes to maintain fruit quality improve shelf-life and saleability. This capacity building consisted of 4 phases implemented during this project. 1. Understanding value/supply chains 2. Developing value/supply chains 3. Implementing new value/supply chains 4. Evaluating new value/supply chains SIAEP and SOFRI have now developed good working relationships with various farmer groups and private enterprises and these include:- • Cat Hoa Loc Group • Metro Cash and Carry • Thu Duc Wholesale Markets • COFIDEC Company - Mango processing • EMU Vietnam (Khanh Hoa Province) • My Hoa Pomelo Cooperative • Cat Chu Mango Producers • Viet Hung Company (Dong Thap Province) • Can Thanh Mango Company Two quality assurance manuals were developed as part of this CARD project. They were based on Vietnamese standards and in consultation with the various farmers groups, collectors and wholesalers in the mango and pomleo value/supply chains operating in the Mekong Delta of Vietnam. These manuals were also submitted to CARD Project Management as part of Milestone 9 Reporting. 7 Dr Le Thi Thu Hong from SOFRI presented an oral talk and paper at the International Society of Horticultural Science (ISHS), Improving the performance of supply-chains in transitional economies conference held at the Sofitel Plaza Hotel, Hanoi, Vietnam, 13-17 September 2007. The Cat Hoa Loc mango group have implemented new harvesting and GAP procedures. They have also built a new pack-house and implemented new handling, postharvest treatments and quality assurance standards, packaging and logistics systems. With help from the SIAEP staff and the CARD Project they have:- • purchased and constructed a cool room • constructed a ripening room • constricted drying grading and sorting tables • developed a specific gravity maturity test • constructed and are using a washing and hot water heat treatment tanks to remove contaminates, control fruit fly and diseases on the harvested fruit. • using fans to dry the fruit on the sorting and grading tables • packing and grading fruit into fibreboard cartons • placing the trade mark stickers on each mango fruit in the carton • implemented quality assurance standards such as:- the pack-house will only accept extra, first and second grade fruit. Third grade fruit is returned to the grower and the grower asked not to send any third grade fruit to the pack- house in the future In 2008 about 700kg to 1 tonne of Cat Hoa Loc grade 1 fruit were sold to Metro Cash & Carry Vietnam Ltd., as a trial shipment. This fruit sold from 55,000 to 75,000 VND/kg. This is about double to triple the normal price. At the end of the CARD Project, a contract was signed with Metro Cash & Carry to supply 5 tonne of fruit. The group also supplies about 70 tonne of fruit to a processor who exports to Japan. The Nam Roi Pomelo My Hoa Farmers Group has obtained Global Gap certificate 2. Tthey exported 18 twenty foot containers to Holland and received about 10,500 VND / kg. This is double the local price paid for pomelo. In 2009 this group exported about 70 twenty foot containers (about 1000 tonne) to Holland and Belgium for about 8,700 VND / kg. They have now signed a contract with Metro Cash and Carry for 34 tonnes of pomelo. They also supply supermarkets in Hanoi with about 18 tonnes of pomelo. They have been trialing fruit vacuum bagging to reduce moisture loss and extend the fruit shelf life. They have also trailed citra shine wax. They have implemented GAP process such as:- • CV for each orchard • production procedure for each member • cultivation procedures In the pack-house they have also implemented quality assurance processes. Some processes put in place at the pack-house are:- • fruit are cleaned by water solution containing chlorine at 150 ppm • trialing vacuum bagging and drying by fan of pomelo fruit for export to Europe • trialing the use net bagging of fruit • placing an origin stamp on fruit 8 • constructed a cool room 4.1 Introduction & Background Ford et al., (2003) analysed the competitiveness of fruit industries in Vietnam and identified: • poor unstable product quality • no quality standards • poor post harvest technologies • poor pre-harvest practices • lack of group co-operative marketing structures • little information about supply chains, prices and customers needs. Stakeholder/beneficiary analysis of fruit crops in the Mekong delta showed that both mango and pomelo (with plantings of 33 000 ha and 9 000 ha, respectively) are very important fruit crops in Southern Vietnam. The objectives of this CARD project 05/040 VIE are to: • Improve pre-harvest technologies to produce high quality mango (integrated pest management, integrated crop management, fruit fly control, maturity indices, reduced pesticide residues, better environmental and human health etc) • Improve mango and pomelo post-harvest technologies (eg, cool chain management, packaging, post-harvest dipping, ethylene ripening, waxing, washing and wetting agents, quality assurance) • Improve quality standards and quality assurance programs for mango and pomelo. The approach and methodologies developed for these crops through this project will be applied to other fruits and vegetables. • Map current supply chains to domestic and selected export markets, with particular emphasis on determining consumer preferences and needs, and reporting results back to farmers. • Provide a better understanding and possible improvements of the supply chain by Vietnamese fruit industries for mango and pomelo. This CARD project provide capacity building training to reduces major weaknesses in pre- and post-harvest technologies affecting product quality, consistency of mango and pomelo. This project has also increased the knowledge and ability of the staff at the Sub-Institute of Engineering and Postharvest Technology (SIAEP) and Southern Fruit Research Institute (SOFRI) to analyese, develop and implement new technologies and change practices to supply chains presently operating in Vietnam. Further training was also provided to farmer groups and chain participants. Highly specialised targeted participatory action learning (PAL) training programs were developed and provided to these institutions and industry stakeholders by this CARD Project 050/040 VIE. CARD Project 050/040 VIE Milestone 10 is: Assessment and documentation of SOFRI and SIAEP institute staff and the farmer group’s competence in:- • Application of supply chain analysis and methodology • Application quality assurance procedures and processes 9 This report is based on case studies of Institutes SIAEP and SOFRI and farmer mango groups (Cat Hoa Loc, Cam Thanh and Viet Hung Company) and the pomelo groups (My Hoa and Hoang Gia Pomelo Company). Information presented in this report highlights the situation before the project commenced (pre-project) and the project impacts (post-project). This report show how the capacity of the institutes and farmer groups has been substantially increased. Each case study also provides evidence of the application of supply chain analysis and methodology and quality assurance procedures and processes. 4.2 Implementation Highlights 4.2.1.1 Background of supply/value chains In the past supply chains were analysed using generic logistic processes such as Commodity Management (CM) as implemented by large supermarkets. This analysis process has now changed to one of creating value for all participants in the supply chain; therefore supply chains are now transformed into value chains. A supply/value chain can be described as: • The planned continuous improvement of processes and relationships that exist to support the movement of goods and services through the value chain that benefits its customers and members. • A value chain is a mutual business agreement between both Horizontal and Vertical businesses whose combined actions result in the delivery of products to a customer for the benefit of all involved. • The value chain of an organisation covers the full range of activities from the earliest level of input through the internal process in the host organisation and on to the output distribution system. Having a good understanding of what constitutes a supply/value chain is critical to it understanding how they operate, how to analyse the chain and how to make changes to the chain to benefit all the chain members. Many individual companies adopt and adapt what they consider are key elements or building blocks of a supply/value chain. They put these building blocks together to suit their particular needs without considering all the necessary supply/value chain elements to be successful. Therefore; supply/value chain participants today must be highly adaptable, so that they can generate added value. These chain participants must adopt new supply chain strategies that will deliver will benefits for themselves, create value for money to their customers’ and ultimately, the end consumer. Supply/value chain participants today must be highly adaptable, as inflexible participants will not generate added value and will be forced out of their industry. These participants must adopt new supply/value chain strategies that will deliver value for money to their customers and ultimately, the end consumer. Two quality assurance manuals were developed as part of this CARD project. They were based on Vietnamese standards and in consultation with the various farmers groups, collectors and wholesalers in the mango and pomelo value/supply chains operating in the Mekong Delta of Vietnam. [...]... project:Phase 1 Understanding value /supply chains • What is a value /supply chain? • Benefits of value /supply chains • Management and coordination of value /supply chains • Benefits of trust and communication • Value /supply chains critical success factors • Designing value /supply chains • Value /supply chain networking and team development • Group dynamics of participants in a value /supply chain o Relationships... Cultivation Handbook • Pomelo Pest and Disease Quick Guide Booklet By developing these manuals and booklets knowledge for both SIAEP and SOFRI was substantially increased in the best practice and GAP pre-harvest factors Also SIAEP and SOFRI staff knowledge increased in how these pre-harvest factors affect the post-harvest fruit quality, shelf-life and saleability of mango and pomelo Both SIAEP and SOFRI staff... shelf-life and saleability, and reduce types and quality of chemicals applied and on-farm input costs o Canopy management (pruning and training) (See Appendix A for these pre-harvest factors and their affects on postharvest shelf-life, saleability and fruit quality.) o Orchard management and Orchard design to facilitate the harvesting, handling, sorting, grading and consolidation (packaging) for transport... now able to carry out a pre-harvest analysis of a supply/ value chain and identify problem areas or factors, e.g best practice and GAP for canopy management (pruning and training for light interception), fertiliser and irrigation, fruit maturity indicators, harvesting and infield handling methods to meet safety and quality standards for mango and pomelo This was achieved through train the trainer methods... these pre-harvest factors affected the postharvest fruit quality, shelf-life and saleability of mango and pomelo as fruit moved down the supply/ value chain 4.4.1.2.2 POSTHARVEST KNOWLEDGE Some of the SOFRI staff in the postharvest section were reasonably knowledgeable of the postharvest aspects of mango and pomelo fruit and methods to maintain shelf-life in Vietnam under Vietnamese conditions For Example,... knowledge of what supply chains or value chains were They also lacked detailed knowledge on how to:• understand the complexities and analysis existing supply/ value chains o understanding what customers and consumers want and developing an effective and efficient logistic and distribution systems o develop information sharing and communication channels • assist chain members to improve their products and chain. .. learning training and capacity building in supply/ value chains was conducted by the Australian team for SIAEP and SOFRI Staff of SIAEP and SOFRI, assisted by the Australian team members then trained farmers and farmer groups to increase their knowledge of supply chains and technical processes to maintain fruit quality improve shelf-life and saleability This capacity building consisted of several phases... agribusiness supply/ value chains to satisfy both domestic and export agricultural markets 11 • • • An increase in supermarkets in Vietnam (domestic and foreign owned) and their food quality assurance programs to supply their customers with products that meet Vietnams GAP and health standards Vietnam is experiencing difficulties in competing with other Asian nations in export markets and its own domestic. .. communication, information sharing, culture and cooperation o People management o Leadership • Value /supply chain mapping • Value /supply chain design and re-engineering of value /supply chains • Diagnostic Process o Designing surveys to obtain critical information o Understanding Quality Assurance Phase 2 Developing value /supply chians • Value /supply chain strategic planning process o Critical areas of major... agronomy and cultural methodology suited to Vietnamese conditions For example Mrs Minh was working on mango agronomic aspects and was developing documents on manipulating mango flowering and fruit set for the off season Staff members also had a good understanding of pathological (disease) and entomological (pests) affecting mango and pomelo Staff of SOFRI did not have a high degree of understanding on . Ministry of Agriculture & Rural Development CARD Project 050/04VIE Improvement of export and domestic markets for Vietnamese fruit through improved post-harvest and supply chain management. Vietnamese fruit through improved post-harvest and supply chain management. Vietnamese Institution Southern Sub-Institute of Agricultural Engineering and Post-Harvest Technology (SIAEP) Vietnamese. value for all participants in the supply chain; therefore supply chains are now transformed into value chains. A supply/ value chain can be described as: • The planned continuous improvement of