Under the agreement, Olam and Hieu Nhan will purchase, process, and export rice supplied by the cooperatives between 2019 and 2020. The rice products are to meet international rice market requirements on product quality and safety, particularly maximum residue limits.
The signing ceremony was part of the second phase of the Better Rice Initiative Asia and Market-Oriented Smallholder Value Chains project. It is to be carried out in the three Southeast Asian countries, including Indonesia, Thailand, and Vietnam, under a public-private partnership between Olam and the German Federal Ministry for Economic Cooperation and Development, operating from 2018 to 2022. In Vietnam, the project has been launched under the same partnership format between the Department of Cooperatives and Rural Development under the Ministry of Agriculture and Rural Development, GIZ and Olam.
The project seeks to improve the livelihoods of 10,000 rice farming households in the four localities in the delta by offering comprehensive solutions, ranging from farming techniques to market approaching skills. In particular, the project focuses on forming organizations of farmer groups and improving capabilities of partners joining the value chain, including farmers, cooperatives, suppliers, processors, and exporters. The signing ceremony marks the first important step for the upcoming sustainable cooperation on the rice value chain in the delta.