A number of Vietnamese billionaires decided to pour money into agriculture projects.
After Doan Nguyen Duc, owner of a powerful real estate group, and Tran Dinh Long, owner of a steel corporation, decided to pour money into agriculture projects, a number of other billionaires did the same.
Five years ago, when the real estate market experienced a slump, Duc, who was then one of the most influential businessmen, surprised people with the announcement that his Hoang Anh Gia Lai would quit the real estate market and focus on agriculture projects.
By the first half of 2016, Hoang Anh Gia Lai had had a herd of 7,500 milk cows and 130,000 meat cows. Prior to that, Duc stated his total investment capital in agriculture had reached VND18 trillion and the investments had brought initial profits.
However, the sharp fall in rubber prices has caused difficulties for the conglomerate. In mid-2016, Duc sold a part of his sugarcane production division and is considering selling 10,000-20,000 hectares of rubber to pay debts.
In 2015, Hoa Phat Group of Tran Dinh Long began injecting money into agriculture. The Hoa Phat Trade & Animal Feed Production, a subsidiary of Hoa Phat, has poured VND300 billion into a feed factory project, hoping to obtain revenue of VND3 trillion in the next three years.
In mid-2016, Hoa Phat imported 500 pig breeders, officially jumping into the husbandry sector. The group plans to begin providing pigs and breeders from early 2018 and obtain 650,000 pigs by 2021.
Like Hoang Anh Gia Lai, Hoa Phat has sustained pressure since the day it began investing in agriculture. It reported satisfactory business results for all non-agriculture fields in the first quarter of 2016, while it took a profit of VND14 billion in agriculture projects.
However, the current difficulties being faced by Hoang Anh Gia Lai and Hoa Phat has not deterred other big businesses.
Pham Nhat Vuong, the richest billionaire in the stock market, the owner of Vingroup, a well-known real estate group, has jumped on the bandwagon.
However, instead of breeding cows and growing sugarcane, the businessman is focusing on developing VinEco, a brand for clean vegetables, amid fear about unsafe food. VinEco’s farm produce is now distributed by Vinmart and Vinmart+, with large networks of shops throughout the country.
More recently, Duong Cong Minh, president of Him Lam, who has 20 years of experience in construction and real estate, has also jumped on the bandwagon with a project on growing macadamia and turning the Central Highlands into a macadamia metropolis in SE Asia.
Trinh Van Quyet, the second richest billionaire, has got the nod from the Thanh Hoa provincial authorities for a project to grow 1,300 hectares of sugarcane and rubber.