[Big read] Malaysia and Vietnam battle Thailand for durian supremacy in China

On the morning of 24 August, a Malaysian chartered flight with a cargo of 1,500 crates containing 15 tonnes and ten varieties of fresh durians, departed from Kuala Lumpur International Airport, arriving the same day at Zhengzhou Xinzheng International Airport in Henan, China. Within 24 hours, fresh Musang King durians were available in China’s major cities.

After visiting the durian packaging and distribution facilities in Shenzhen on 26 August, Malaysian Agriculture and Food Security Minister Mohamad Sabu wrote in a Facebook post that despite the price of 350 ringgit (about US$80) for a Musang King fruit in Shenzhen, “all the durians were sold off within a couple of hours”.

In 2023, China imported 1.43 million tonnes or US$6.7 billion worth of fresh durians in 2023, with 99.8% coming from Thailand and Vietnam. Malaysia hopes to join them on the bandwagon of the “China durian economy”; it has planned this for several years, exporting to China frozen durian products since 2011 and frozen durians since 2019, and obtaining approval to export fresh durians in June 2024. Unlike frozen durians, fresh durians have not been frozen using liquid nitrogen.

Malaysian durians are different from Thai and Vietnamese durians. The former fall to the ground naturally after ripening on the trees, while the latter are picked from trees and quickly ripened during transportation. Having ripened naturally, Malaysian durians have richer flavour and softer flesh, but also a shorter shelf-life, which is a disadvantage compared with Thai and Vietnamese durians.

Fresh Malaysian durians can only be exported to China by air, which requires complete cold-chain logistics and distribution to ensure that fresh durians reach consumers within 48 hours after they have fallen from the trees.

According to Xinhua, Malaysia’s charter flight with its durian cargo flew directly from Kuala Lumpur to Zhengzhou, and the durians were then distributed via cold-chain transportation to cities like Beijing, Shanghai, Shenzhen, Xiamen and Shenyang.

Due to the stringent timeliness requirement for customs clearance, a green channel for fresh cold-chain goods has been set up at the customs of Zhengzhou Xinzheng International Airport, so that the goods are inspected on arrival and can clear customs quickly.

Despite the huge profits from exporting fresh durians to China, many Malaysian exporters are adopting a wait-and-see attitude towards the export process and its technical feasibility.

Lye Wee Tin, a consultant with PHG Ever Fresh Food in Raub, Pahang, said in an interview with Lianhe Zaobao that there are still many uncertainties in exporting fresh durians to China. “The durian export process requires the cooperation of the Malaysian and Chinese customs, to ensure that the fruit’s freshness is maintained by clearing customs as quickly as possible. As the export quantity depends on air freight capacity, exporters will only charter flights to China once its demand for durians has stabilised.”

PHG Ever Fresh Food has been in the durian business for over 30 years and is Malaysia’s largest durian processing company and exporter. It has exported frozen durians to China since 2017, and is considering exporting fresh durians.

When Malaysia exported fresh durians to China at the end of August, it was already near the end of the harvest period. So, exporters are observing the response of China’s market to the first batch of fresh durians, and are expected to export large quantities from next year.

Lye urged Malaysian exporters not to sacrifice the durians’ quality for profit, but stick to natural ripening to maintain the uniqueness of Malaysian durians. “Even if we harvest for greater export volume, we cannot match Thailand and Vietnam, as they are geographically better located and produce more than us.”

Malaysia’s Musang King durians are highly sought after in China. Two years ago, Thai buyers harvested unripened Musang King from Malaysia and sold them to China as “Thailand Musang King”. Consequently, to safeguard the interests of the Thai durian growers and the Thai durian brand, last year the Thai government banned Thai buyers from such actions and stopped imports of Malaysian durians, before the incident was closed. This also prompted Malaysia to speed up negotiations with China on the export of fresh durians.

Raub is home to Malaysia’s Musang King, where most of the top-grade fruit comes from.

The durian season was ending when this Lianhe Zaobao reporter visited Kampung Sang Lee in Raub in late July. Durian suppliers from all over Malaysia gathered at the wholesale station early in the morning to snap up the last few batches of freshly fallen Musang King.

Durian plantation owner Wong Tim Choi expects to be busier during the next harvest, as large volumes of fresh durians will be exported to China.

Having the huge China consumer market is good news for the more than 63,000 Malaysian durian plantation owners and exporters. However, some consumers are concerned that the export of large quantities of fresh durians to China would drive up the prices of durians in Malaysia and Singapore.

Kuala Lumpur resident and business owner Tan Guet Meng, 54, said when interviewed that Musang King retails in KL for about 20% more than in Raub where it is grown. “It seems that durians will be increasingly expensive now that fresh durians are sold to China”.

Isa, a durian stall vendor in Subang Jaya in Selangor, says exporters will usually export the highest grade and best quality durians to China, where there is higher spending power. “The durians that Malaysians consume may be of a lower grade; at the price that customers pay for A-grade Musang King now, they may only be able to buy B-grade fruits in the future”.

Malaysia’s Sin Chew Daily reported that the retail price of the first batch of fresh Musang King in China is three times that in Malaysia. While Musang King sells for about 40 ringgit per kg in Malaysia, A-grade Musang King was going at 99 RMB for 500g (about 60 ringgit) at a durian tasting event in a Zhengzhou supermarket.

Raymond Ng, who operates durian stalls in Ghim Moh and Jalan Besar in Singapore, said in a telephone interview that the price of durians depends on supply and demand. If Malaysia exports durians to China on a large scale, Singaporeans may end up eating durians at expensive prices. “If prices increase, we can only roll with it. In fact, durians are already not cheap now. Musang King costs S$20 to S$30 per kg, and it is hard to imagine that it will be more expensive than right now.”

However, he believes that there are advantages in Malaysia exporting durians to Singapore rather than to China. “As there is only a two-day shelf-life for Malaysian durians from ripening to selling to consumers, it is a greater challenge to export to China. I believe that the durians sold in Singapore are fresher than those exported to China.”

Lee Kwai Siang, a durian supplier in Raub, thinks that the export of fresh Malaysian durians to China will have little impact on Singapore. “The prices and quantities of durians in Singapore will not be much affected because the profits from exporting to Singapore are greater to begin with. It is a market we are familiar with, where the processes are simpler and transport is cheaper.”

Lye Wee Tin feels durian prices will not fluctuate too much, because the technology used in durian plantations has improved, and the scale and yield of planting have also increased every year. “The export of fresh durians to China is just another sales channel. The price will stabilise as yield increases.”

However, it is just a matter of time that Malaysian suppliers get to know the Chinese market. As Singapore is only a small market, suppliers will pay greater attention to the huge market in China.

According to official statistics, from 2017 to 2023, Malaysia exported 5.17 billion ringgit worth of durians, with China accounting for 73%, and Singapore and Hong Kong ranking second and third at 8% and 6% respectively.

Vietnam obtained approval to export fresh durians to China in July 2022; in less than two years, it has become the second largest exporter of durians to the Chinese market, and it even has its sights on overtaking Thailand.

As reported by Economic Daily, China imported 825,000 tonnes of fresh durians in 2022, of which about 95% came from Thailand. Last year, China’s imports increased by 70% to 1.426 million tonnes, with 65.2% coming from Thailand and 34.6% from Vietnam, at a revenue of US$2.3 billion.

In the first seven months of 2024, Vietnam’s exports of fresh durians to China is at US$1.22 billion, an increase of 46% over the same period last year.

With the jump in its durian exports, Vietnam has its eyes on overtaking Thailand as the new king of the Chinese durian market. And according to data from China’s General Administration of Customs, in the first two months of 2024, Vietnam did overtake Thailand, accounting for 62% of durians exported to China. However, Thailand regained top spot after the harvest in the second quarter.

But there is still hope for Vietnam, because the durian harvest in Thailand generally ends in October, and Vietnam can fill the gap.

Compared to Thailand and Malaysia, durian cultivation in Vietnam has many advantages. VietnamPlus cited a report from Vietnam Fruits and Vegetables Association that Vietnam’s yield is greater as its durians can be harvested in any season, whereas the yields of the other major durian producing countries are concentrated in several months of the year.

Vo Tan Loi, director of fruit exporter Phuong Ngoc Cai Be Company in Tien Giang province, said in an interview with Lianhe Zaobao that Vietnam is naturally endowed with unique soil and climate suitable for growing durians, which has encouraged the development of its durian plantation industry. “The red basaltic soils of the central Vietnamese highlands at 800 to 1,000 metres are suitable for planting the Dona durian, and the sedimentary soils at the Mekong Delta are very suitable for the Ri6 durian.”

In addition, Vietnam durians have the edge over Thailand in terms of logistics and transportation. It only takes 36 hours for Vietnamese durians to reach China via the Friendship Pass, while it takes at least three to four days for Thai durians.

Vo Tan Loi said that thanks to its neighbouring geographic location, Vietnam’s greatest advantages are in logistics and transportation. “Being connected to China by land enables Vietnam to transport durians by trucks or trains, which is faster and less expensive.”

The opening of China’s durian market to Vietnam has brought tangible benefits to Vietnam’s durian farmers, including increased income and improved lives. Vo Huu Thoai, head of Vietnam’s Southern Fruit Research Institute, said in an interview that Vietnamese durian exports have increased rapidly since Vietnam started exporting to China, which has led to an increase in the local retail price of durians. “Durians are a pillar of the Vietnamese agricultural industry. China’s import of Vietnamese durians has increased Vietnam’s foreign income, created more employment opportunities for durian growers and the entire supply chain, and increased the income of growers and employees in the industry.”

Nguyen Thanh Trung, a political scientist at Fulbright University Vietnam, believes that Vietnam’s durian trade will also bring potential benefits to China, as the Vietnamese who profit from it will be “more positive” towards China. The frequent trade between the two countries will help to warm bilateral relations that may have been affected by the longstanding sovereignty dispute in the South China Sea.

While opportunities abound for Vietnamese durians, there are also numerous challenges.

Vo Tan Loi feels Vietnam can do better in terms of yield and consumer awareness of its species. “While Vietnam has durian varieties that are not found in Thailand and Malaysia, such as the Ri6 durian, it lacks a famous variety like Malaysia’s Musang King. Vietnam’s yield is higher than Malaysia but still lower than Thailand.”

Nguyen Thanh Trung made the point that the huge demand for durians in China’s market may lead Vietnamese growers to recklessly use land to grow durians at the expense of other crops, which might lead to serious consequences if China loses interest in durians in the future.

In fact, this is already happening, and causing concern. Vietnam’s Nhân Dân newspaper reported that the cultivation of durians has started in some areas with unsuitable climates and soil. The cultivation of durian trees is rapidly increasing in Bình Thuận province, which is famous for cashew nuts and dragon fruit. Many farmers have cut down coffee, pepper and mango trees to make room for durian trees.

Vo Tan Loi noted that when supply exceeds demand and if there are no clear contracts, China’s importers will take the opportunity to push down durian prices with Vietnamese growers, which would lead to losses for them.

The Vietnamese government has begun to address this problem. In July 2023, the Ministry of Agriculture and Rural Development asked local governments to review the size of durian plantation areas under their charge, coordinate overall planning, develop professional durian plantations, promote mechanised production, and invest in the related durian packaging and processing industries.

Vietnam durians also face quality issues. On 11 June, the Department of Animal and Plant Quarantine of the General Administration of Customs in China reported that 77 recent batches of Vietnamese durians exported to China were found to have excessive levels of the heavy metal cadmium, and that China has suspended durian imports from 15 packaging factories and 18 plantations.

Vo Huu Thoai urged those involved in Vietnam’s durian supply chain to take China’s legal requirements seriously.

“With China’s increasingly stringent requirements for imported fruits, the relevant Vietnamese parties should enhance their management of durian plantations and packaging factories to ensure that the price of durians is reasonable and that the fruit is safe for consumption. This will make Vietnamese fruits in China’s market more competitive.”

This article was first published in Lianhe Zaobao as “挑战泰国霸主地位 马国越南榴梿落地 抢鲜包吃中国市场”.

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