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“The low note” of… Sanh oranges: Part 2 - Challenges surrounding the orange processing industry

Việt NamViệt Nam23/01/2025


09:17, 23/01/2025

BHG - Sanh oranges are considered the “golden resource” of Ha Giang due to their high economic value and outstanding development potential. The establishment of orange processing facilities is a clear demonstration of the efforts to improve the product and overcome the limitations of fresh fruit consumption. However, the Sanh orange processing industry is facing many challenges, requiring breakthrough strategies and systematic investment for sustainable development.

From expectation…

Our province is one of the localities with the largest orange production areas in the Northern Midlands and Mountains. Through the promotion and advertising work of all levels and sectors, Ha Giang Sanh oranges have been brought to consumption at WinMart Supermarket, Big C ( Hanoi ), stable sales points at wholesale markets in the Northern provinces and expanded the market to the South. However, the orange product has only stopped at consuming fresh fruit. Meanwhile, Sanh oranges are ripe in large quantities, the natural preservation time is limited, and it is difficult to consume immediately in a short time. For example, in 2019, the output of Sanh oranges reached over 60.7 thousand tons, 3.4 times higher than the output in 2016.

Ha Giang Oranges are labeled with traceability labels and are mainly consumed as fresh fruit.
Ha Giang Oranges are labeled with traceability labels and are mainly consumed as fresh fruit.

In order to overcome the limitations of fresh fruit consumption, orange processing and preservation factories have been established, expected to create a breakthrough in orange production and processing right in the commercial orange growing areas. In 2019, the whole province had 4 orange processing and preservation facilities. In particular, Vi Xuyen district is an orange producing area with a fruit juice processing factory, belonging to Bao Chau Pharmaceutical Group Joint Stock Company, Group 12, Vi Xuyen town, with an industrial production scale with a capacity of up to 190,000 liters/year. When put into operation, the enterprise will purchase from 8 - 10 thousand tons of oranges/year to process orange juice products and some health protection products, cosmetics from Sanh oranges such as: laundry detergent, hand sanitizer, dishwashing liquid...

In Bac Quang district, there are two small-scale orange processing facilities including: Cam Ta Joint Stock Company, Khuoi Nieng village, Dong Thanh commune with a capacity of 2 tons of oranges/day and an orange essential oil processing facility with a capacity of 5 tons of oranges/day, owned by Phu Vinh Cooperative, Viet Quang town. In 2019, Cam Ta Joint Stock Company was established and became the pride of the people of Dong Thanh commune when the locality had the first enterprise to purchase and process Sanh oranges. Thereby, not only solving the problem of consumption, increasing the value of Sanh oranges but also creating regular jobs for many local workers with an average income of 6 million VND/person/month. In particular, the Company has coordinated with a group of Dutch experts to receive technology transfer for processing products from Ha Giang Sanh oranges according to European standards, aiming for export. In addition to Orange Molasses, Dried Orange Peel Jam, and Orange Wine, the Company has 3 OCOP-starred products including: Orange Essential Oil (3 stars), Orange Jam, and Orange Syrup (4 stars).

Director of Cam Ta Joint Stock Company Nguyen Viet Cuong shared: “On average, the Company supplies the market with more than 4,000 processed orange products per year, bringing in revenue of over 1.4 billion VND. In addition to selling on e-commerce platforms, we are the main partner in supplying 3-6 tons of Orange Molasses per year to 3 milk processing facilities including: Amifarm Moc Chau (Son La province), Muc Dong Milk ( Hoa Binh province), Kefir Yogurt (Hanoi city). Thereby, contributing to expanding the market, bringing high-quality Orange Molasses products to consumers”.

Particularly in Quang Binh district, the establishment of Green Agriculture Cooperative, Trung village, Bang Lang commune has become an address for purchasing and preserving oranges for consumption and processing with a capacity of 20 tons/day. On average, each year, the Cooperative purchases more than 100 tons of raw oranges for preservation in cold storage. The application of scientific and technical advances helps the Cooperative minimize risks in the process of storing fresh Sanh oranges, aiming for professional and sustainable agricultural production.

… To the “knot” that needs to be untied

Currently, Cam Ta Joint Stock Company has 6 processed orange products, contributing to raising the brand of Ha Giang Sanh oranges.
Currently, Cam Ta Joint Stock Company has 6 processed orange products, contributing to raising the brand of Ha Giang Sanh oranges.

In fact, orange processing is a special field, requiring strict requirements on food safety, technology, and the company's own secrets. Therefore, very few businesses operate in the orange processing field, making it difficult to call for investment in new factories. In addition, businesses lack capital while the cost of investing in production lines is not small. Director of Ta Orange Joint Stock Company Nguyen Viet Cuong said that the Company has invested in orange processing lines such as: orange washing machine, orange pressing machine, orange juice vacuum condenser, cold drying cabinet, essential oil distiller... with a total investment of more than 3 billion VND. If investing systematically in the production line (small-scale handicraft industry), it requires capital of more than 20 billion VND. But currently, the Company has only invested a small part of that.

According to the assessment of the professional agency, Sanh oranges have thick skin, many seeds, low orange juice content, and higher essential oil content compared to other types of oranges, causing difficulties in processing, preserving, and harvesting oranges. On the other hand, the input materials (Sanh oranges) for processing in many regions are not of uniform quality, the fruits are damaged and rotten (due to the harvesting and transportation process)... meanwhile, the standards for raw oranges for processing are relatively strict in terms of ripeness, size, juice content, and the oranges must be intact, without scratches, ensuring food hygiene and safety.

Along with the above difficulties, oranges only have a seasonal season (about 3-4 months/year) but the production activities of enterprises take place all year round. Therefore, the establishments have to purchase a large amount of oranges during the season to produce and store orange pulp, leading to a large amount of working capital remaining in the storage of orange pulp. Moreover, the selling price of raw oranges is unstable from year to year, leading to difficulties for processing establishments in their business strategies and annual production plans. Not only that, oranges for processing have a lower purchase price than oranges sold at stores, supermarkets, and traditional markets, making orange growers willing to break the contract to purchase products of enterprises. Meanwhile, the State has not created a suitable legal corridor for resolving disputes in the connection between orange growers and processing establishments. Therefore, there has not been a close connection between raw material areas and processing establishments to maximize the capacity and efficiency of orange processing factories.

Ha Giang Sanh oranges are mainly sold fresh by producers for domestic consumption (an average of 45 - 50 thousand tons of fresh fruit/year). Meanwhile, consumers are in the habit of using fresh oranges, making it difficult to expand the market for processed orange products. The output of Sanh oranges for processing only accounts for about 0.3 - 0.5% of the total output. For example, Bao Chau Pharmaceutical Group Joint Stock Company only produces 1/3 of its products as orange juice, the rest produce other types of drinks such as: energy drinks, hawthorn, green tea... because it has not been able to expand the consumption market. Therefore, the output of orange raw materials has not reached the initial expectation of more than 10,000 tons of oranges/year.

Although the Sanh orange processing industry has shown positive results in the early stages, in recent years, Phu Vinh Cooperative, Green Agriculture Cooperative and Bao Chau Pharmaceutical Group Joint Stock Company - the units that were expected to be the pillars promoting the Sanh orange value chain - have all stopped operating due to legal problems and internal difficulties. Currently, only Ta Orange Joint Stock Company continues to operate, "shouldering" the mission of developing the processed orange brand.

In fact, the establishment of orange processing and preservation facilities has marked an important step forward, bringing Ha Giang Sanh oranges from fresh fruit production to deep processing, creating a product value chain in the production of commercial oranges, increasing production value. This contributes to overcoming the weaknesses of small-scale agricultural production, lacking cohesion, towards modern agriculture, capable of competing in the market. However, to optimize this potential and advantage, the "problem" of developing the orange processing industry still needs to find satisfactory solutions.

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Final episode: Urgent brand rescue

Article and photos: THU PHUONG



Source: https://baohagiang.vn/kinh-te/202501/not-tram-cam-sanh-ky-2-thach-thuc-bua-vay-nganh-che-bien-cam-3780a0d/

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