Agricultural production based on value chains is recognised as a sustainable approach that improves production efficiency and raises farmers' and businesses' incomes. Many enterprises and agricultural cooperatives in Hoa Binh have applied high-tech methods to production, linking their efforts to building value chains for their products.

A value chain refers to a sequence of activities where each step adds value to the product. In agriculture, this includes input activities, production, processing, and trade. The agricultural production chain involves coordination among fertiliser suppliers, seed providers, livestock breeders, farmers, cooperatives, processing companies, and distribution channels like markets, supermarkets, and export outlets.

To promote agricultural production through value chains, increase farmer income, and ensure participants’ rights and responsibilities, the Government issued Decree No. 98/2018/ND-CP on July 5, 2018, to encourage cooperation and linkage in agricultural production and consumption. The provincial People's Committee responded by issuing Decision No. 2793/QD-UBND on December 20, 2018, to approve priority agricultural products for support and consumption. Furthermore, the Provincial People's Council passed Resolution No. 226/2019/NQ-HDND on December 11, 2019, focusing on support for production linkages and consumption of agricultural products during 2020-2025.

With the issuance of these policies, the province has built an effective mechanism to implement agricultural production chains. The provincial People's Committee has integrated production linkages into socio-economic development plans. Moreover, the province has established support activities and funding standards for participants in the value chains, in line with Decree No. 98/2018/ND-CP.

Ha Ngoc Tuan, Chairman of the Hoa Binh Cooperatives’ Alliance, emphasised that cooperatives play a vital role in agricultural value chains. With support from central and local authorities, cooperatives are encouraged to shift to value chain-based production. The alliance has organised conferences to foster production linkages and product consumption for agricultural products from cooperative members.

By the end of 2023, the province had over 100 linked production chains providing safe food, covering vegetables, aquatic products, livestock, and processed products. Four of these chains received budget support. In 2024, the provincial People's Committee allocated over 166 billion VND (6.52 million USD) for building value chains and approved 12 related projects. These projects are located across districts like Kim Boi, Lac Son, Tan Lac, Cao Phong, and Da Bac, covering products such as peppers, vegetables, sweet corn, potatoes, local chickens, sugarcane, and Cao Phong oranges.

Value chains play a significant role in agriculture, especially as economies become more integrated globally. Haa Binh’s agricultural products are not only for domestic consumption but are also aimed at export. Some of the province’s key agricultural products, such as Dien Ngoc Luong grapefruit, red-fleshed grapefruit from Tan Lac, and Cao Phong oranges, are already exported. The province’s agricultural sector reports that many farming areas in these value chains have received certifications like VietGAP, GlobalGAP, and organic product certifications, enhancing access to larger markets. Additionally, cooperatives and businesses sign contracts with supermarkets and distributors, ensuring stable product sales.

Despite the successes, challenges remain, particularly in linking value chain stages and ensuring sustainable consumption. Vu Thi Le Thuy, Director of 3TFarm Cooperative in Cao Phong, pointed out that the collection, processing, and consumption stages lack sustainability, with many intermediaries involved. For example, Cao Phong orange farmers mostly sell to middlemen. Even though 3TFarm is a well-known cooperative, it often has to seek sales channels independently, she said.

To address these issues, the Hoa Binh Cooperative Alliance has organised forums to promote production linkages and consumption. Tuan suggested that improving human resources in cooperatives through training is key, along with supporting businesses to collaborate with cooperatives. Strengthening quality standards and product traceability is crucial for enhancing competitiveness and ensuring food safety.

Developing agricultural value chains has not only boosted market competitiveness but also supported sustainable economic growth. Vuong Dac Hung, Deputy Director of the provincial Department of Agriculture and Rural Development, emphasised the importance of planning and resource allocation to improve infrastructure, attract investment, and integrate scientific advances into production. Hung also pointed to the need for strengthened State management and contract enforcement, and close supervision of agricultural material market as well as the quality of farm produce in the process.