Vietnam Fertilizer Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

Market Overview

The Vietnam Fertilizers Market was valued at USD 1,781.2 million in 2020, witnessing a CAGR of 4.9% over the forecast period (2021-2026). Amidst the COVID-19 pandemic, the Vietnamese Government imposed various measures such as social distancing, mobility restrictions and shutdown of non-essential service facilities to contain the outbreak. The movement restrictions along with the poor farm economics moderately impacted the fertilizers market in Vietnam, as the country took early steps and supportive policies. Therefore, other than the supply chain disruptions not much turbulence was felt on the fertilizers market in Vietnam.

Over the medium term, increasing area for crop production, the need for increased land productivity, rising adoption of new farming practices, increasing area under organic farming are expected to drive the market growth. The use of organic fertilizers is on the rise as farmers see improvements in the soil, crops and environment as compared to the chemical fertilizers. Hence, many companies are steadily increasing the production of organic fertilizers with the growing demand in the country. The Ministry of Agriculture and Rural Development's Plant Protection Department has also collaborated with major companies such as Lộc Trời Group JSC, Con Cò Vàng Hi-Tech, Quế Lâm, Phúc Thịnh, GNC, Hiệp Thành, and Green Powers to develop organic fertilisers. Moreover, the arable land area is also gradually rising in the country over the past few years. The increase in arable land area, coupled with the government’s initiative for increasing agricultural exports, is expected to drive the Vietnamese fertilizer market’s growth. However, the climate change, strict regulations on chemical residues are likely to act as restraints to the growth of the industry.

Scope of the Report

A fertilizer is a natural or synthetic, generally chemical-based substance that is added to plants either directly or indirectly to enhance fertility and growth along with water retention and soil effectiveness. For the purpose of this report, the fertilizers used in agriculture have been considered. The Vietnam Fertilizers Market is segmented By Product Type (Synthetic and Organic fertilizers) and by Application (Grains and Cereals, Pulses and Oilseeds, Fruits and Vegetables, and Other Crop Types).

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Key Market Trends

Rising Demand for Organic Fertilizers

The use of organic fertilizers is emerging in the country as more and more farmers refrain from using chemicals to increase the agriculture output per hectare of land. This is attributed to the rising awareness among farmers, as they witness the improvements in the soil, crops, and environment by the use of organic fertilizer. The Ministry of Agriculture and Rural Development's Plant Protection Department has collaborated with major companies such as Lộc Trời Group JSC, Con Cò Vàng Hi-Tech, Quế Lâm, Phúc Thịnh, GNC, Hiệp Thành, and Green Powers to develop organic fertilizers. In 2019, Lộc Trời and the department signed a deal to enhance the production and usage of organic fertilizers. Lộc Trời is a major player which entered the organic fertilizer market in 2009, and at present supplies to the market two million liters and 10,000 metric ton of organic fertilizers annually.

With the steady rise in demand for organic fertilizers, many fertilizer companies are steadily increasing the production of organic fertilizers. According to the Ministry of Agriculture and Rural Development, the organic fertilizer products in the country increased from 713 in 2017 to 2,312 in 2019. The share of organic fertilizer has also increased from 5 % to 11.1% during that period.

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