The Russia-Ukraine tension may deliver a major blow to agricultural trade between Vietnam and both the countries, the Ministry of Agriculture and Rural Development (MARD) said. 

The trade will be affected by Russia being disconnected from the SWIFT payment system, the disruption of the supply chain in export-import as major shipping companies have suspended their service to Russia, rising transport cost, and declining demand in Russia, Ukraine and related countries. 

Vietnam exported about 550 million USD worth of agro-forestry-aquatic products to Russia last year. Of the figure, coffee export raked in 173 million USD and aquatic products 164 million USD.

Furthermore, Vietnam imported input materials for agricultural production from Russia and Ukraine such as wheat, maize and fertiliser. The country purchased about 500 million USD of agro-forestry-aquatic products from Russia last year.

Deputy Minister of Agriculture and Rural Development Phung Duc Tien said firms must keep a close watch on the situation to handle inventories or find alternative export markets. Importers should seek suppliers from other countries. 

The MARD will closely join hands with trade associations and the State Bank of Vietnam to support payments for businesses whose products have already been sent to Russia but payment is being affected by stagnant financial transactions, the official added. 

The ministry will also work with importers to seek measures to stabilise prices of input materials for domestic agricultural production, and bolster investment attraction.

Source: VietnamPlus