American customers rush to buy 'black gold' after tax delay, Vietnamese businesses rush to work overtime

Just yesterday, American customers said they could no longer do business, but early the next morning they contacted to buy products. There were so many orders that the company had to work 3 shifts.

This was shared by Mr. Phan Minh Thong, Chairman of the Board of Directors of Phuc Sinh Group, when speaking about the changes in the business and its partners after President Donald Trump decided to postpone the imposition of high tariffs on imported goods from 75 countries, including Vietnam.

Pepper exports are a strength of Vietnam, accounting for 40% of global production and 60% of the export market share. In 2024, the country exported approximately 230,000 tons of pepper, earning 1.31 billion USD.

Notably, this commodity, often referred to as Vietnam's "black gold," accounts for a significant proportion of Vietnam's pepper exports to the US market. Specifically, in 2024, exports to the US reached 72,300 tons of pepper, generating approximately $409 million in revenue, representing 31% of Vietnam's total pepper export value.

In the first three months of this year, Vietnamese businesses exported nearly 47,300 tons of various types of pepper, worth $324.6 million. Compared to the same period last year, the volume of pepper exports decreased by 16.7%, but the value increased by 37.8% due to persistently high pepper prices.

Pepper is a multi-billion dollar export item for Vietnam's agricultural sector. Photo: Minh Khang Pepper.

Accordingly, in just three months, the US spent approximately $83.4 million to import 11,019 tons of "black gold," accounting for 25.7% of Vietnam's export turnover and making it the largest customer for Vietnamese pepper.

According to the leader of the Vietnam Pepper and Spice Association, because the US is the largest export market, the information about the 46% tariff imposed by the US came as a complete surprise to businesses in this industry. By April 7th, many contracts already signed with US partners had to be halted or canceled because American customers feared the increased tariffs would be very risky.

However, business transactions between Vietnamese and American companies changed dramatically when President Donald Trump unexpectedly announced a temporary 90-day postponement of high import tariffs.

Mr. Phan Minh Thong shared, "As the number one pepper exporter to the US, if on April 9th, many US customers told us they couldn't do any more business, by early morning on April 10th, they were sending messages non-stop, and we received a lot of orders." Customers finalized orders so quickly that Phuc Sinh had to work frantically in three shifts.

Following the US's move to postpone high tariffs for 90 days, the price of "black gold" (pepper) fluctuated sharply. In Vietnam, the price of pepper today (April 11) increased by 4,000-5,000 VND/kg, reaching 153,000-155,000 VND/kg.

Meanwhile, Vietnamese black pepper exports are priced between $6,600 and $6,800 per ton, while white pepper is priced at around $9,600 per ton.

The US doesn't produce pepper, so it imports a large amount each year, mainly from Vietnam. "Now we're just focusing on trading," said Mr. Phan Minh Thong.

With the 90-day tax deferral, in addition to urgently accelerating the completion of previously signed orders for shipment to the US, Dr. Nguyen Thuong Lang - senior lecturer at the Institute of International Trade and Economics (National Economics University) advises that businesses need to urgently prepare a sufficiently large risk contingency strategy capable of withstanding the impact over a long period.

He pointed out the enormous domestic market of 100 million people. Vietnamese businesses need to build a solid domestic supply chain, creating the highest possible resilience to unforeseen "shocks".

Meanwhile, the Chairman of the Board of Directors of Phuc Sinh Group believes that if we want businesses to return to the domestic market, or support businesses in both developing their "home market" and expanding their "foreign market," we need policies that support domestic manufacturing businesses in the same way as export businesses.

"When export businesses sometimes borrow USD at interest rates just over 1%, while domestic manufacturing businesses borrow VND at rates as high as 9-10%, this cannot be considered a fair mechanism. If the domestic manufacturing market had attractive loan packages, I believe it could create an even richer market for products," Mr. Thong frankly stated.

Furthermore, if Vietnam had a commodity exchange, it would help businesses be more proactive and even participate in regulating the global flow of goods.

Mr. Thong emphasized that there is no "miracle cure" with immediate support policies, but the exchange could be a "magical bag" to help businesses significantly reduce the impact of US market tariffs. Trading through the exchange would then allow the flow of goods to spread throughout the world , rather than being dependent on a single largest market.

Vietnamnet.vn

Source: https://vietnamnet.vn/khach-my-toi-tap-mua-vang-den-sau-hoan-ap-thue-dn-viet-gap-gap-tang-ca-2390085.html