Tight credit hampers Delta farmers

Agricultural produces are fetching good prices, but many farmers and enterprises in the Cuu Long (Mekong) Delta can’t access the loans they need to farm.

The price of tra fish had risen to a record high of 25,000 dong (US$1.2) a kilogram with promises of good profit margins for farmers, but a lot of ponds in Can Tho City, An Giang and Dong Thap provinces were empty because farmers did not qualify for loans, Sai Gon Giai Phong (Liberated Sai Gon) newspaper reported.

Vo Van De, whose family has bred tra fish in Can Tho’s Thot Not District for many years, said: “The current price of tra fish is our dream, but a lot of tra fish farmers can’t take advantage of it because they don’t have the capital to invest.”

Previously, De had regularly borrowed from the Viet Nam Bank for Agriculture and Rural Development (VBARD) to breed tra fish, but the bank stopped giving him loans two years ago because of the business risks that went with tra fish farming. Other banks were also saying no to loan applications, especially from small farming operations, as their new policies favoured bigger and better connected farms.

Le Chi Binh, deputy chairman of the An Giang Fisheries Association, said with current high prices of raw materials for tra fish breeding, 21billion dong ($1 million) in capital was needed to breed 1,000 tonnes of the fish.

Without credit, farmers would not have enough to get started because the capital required was large, Binh said, adding that many smaller tra fish breeders had abandoned their ponds leaving processors with a shortage.

It’s the same story for shrimp breeders in the delta who also can’t access bank loans.

Vo Hong Ngoan, well known as “shrimp king” in Bac Lieu Province, said to invest in one ha of shrimp, farmers needed about 400-500 million dong ($ 19,230-24,000)

Rice

Nguyen Van Doi, chairman of the Binh Thanh Agriculture Co-operative in Dong Thap Province’s Lap Vo District, said the prices of fertiliser, petrol and pesticides had recently increased so the production cost of the coming summer-autumn rice crop would increase by 20-30 percent.

The biggest concern of the co-operative was seeking capital to help its members boost rice production, take advantage of the high export price of rice and increase incomes for members, Doi said.

Nguyen Van Diep, chairman of the Vinh Long Province People’s Committee, said to boost the Delta’s agriculture and seafood production and exports, the Government should give priority in loans for agricultural production and exports.

According to bank representatives, many banks continue to provide loans for agriculture production and they will give priority to good production plans and models that are co-operated between farmers and enterprises.

Vo Ngoc Diep, director of the Viet Nam Joint Stock Commercial Bank for Industry and Trade’s Dong Thap Province Branch, said that this year his branch would increase loans for agricultural production by 30 percent.

However, borrowers must have good production plans, ensuring the effective use of loans, Diep said.

Le Van Tho, director of the VBARD’s Can Tho City Branch, said in the near future the branch would restrict small-scale loans and loans for individuals to focus on providing large-scale loans for the production models of this category.

Cuu Long Delta is the country’s largest rice production and export area and has a strong position in aquaculture and fruit growing.

Tags: Delta farmers