The Vietnam Rubber Group (VRG) held a conference on June 14 to review its latex purchasing performance during 2020–2023. The Group reported notable achievements that have contributed significantly to its overall business resultsand strengthened its economic and social role in local communities — earning strong support from authorities and residents.
Supporting Smallholder Rubber Farmers
The conference evaluated VRG’s purchasing structure, identified challenges and constraints, and proposed solutions to improve efficiency while sharing successful practices among subsidiaries.
According to Mr. Duong Tuan Anh, Deputy Head of VRG’s Business Market Department, the Group’s rubber latex purchasing operations have generated both economic and social benefits.
To systematize the process, VRG’s leadership issued Regulation No. 61/QĐ-HDQTCSVN (March 4, 2015) on rubber purchasing and processing, providing a legal framework and unified direction for member companies. In 2021, the Group introduced Decision No. 162/QĐ-HDQTCSVN, amending several provisions to address limitations and create more favorable conditions for purchasing activities.
In addition to encouraging subsidiaries to actively procure latex, VRG began assigning annual purchasing targets as part of each company’s business plan. Thanks to this policy, total purchased output grew strongly, peaking at over 90,000 tons per year.
However, in 2022 and especially 2023, the volume declined due to higher processing costs compared with private buyers. VRG’s production units incur higher investment and accounting expenses, making their purchase prices less competitive. Although the 2021 regulation sought to resolve these issues, many companies have yet to apply it effectively.
Potential to Reach 100,000 Tons Annually
Currently, 37 VRG subsidiaries conduct latex procurement across various regions:
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Southeast Region: 13 companies (including Dong Nai, Dau Tieng, Phuoc Hoa, Binh Long, Phu Rieng, Dong Phu, Loc Ninh, Tan Bien, Hoa Binh, Ba Ria, Phu Thinh, Tay Ninh, Hang Gon)
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Central Highlands: 10 companies (including Krong Buk, Ea H’leo, Bao Lam, Chu Pah, Chu Prong, Chu Se, Mang Yang, Chu Mom Ray, Dong Phu Dak Nong, Sa Thay)
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Central Coastal Region: 5 companies (Binh Thuan, Quang Tri, Ha Tinh, Thanh Hoa, Quang Nam–Nam Giang)
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Northern Mountains: 2 companies (Lai Chau, Dien Bien)
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Cambodia: 4 companies (CRCK 2, Dong Nai Kratie, Hoang Anh Mang Yang K, Dong Phu Kratie)
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Laos: 2 companies (Viet-Lao, Quasa Geruco)
Among these, 28 companies have established purchasing departments or teams, with staff numbers ranging from 7–12 employees, and some reaching up to 49.
If the purchasing system is organized and maintained effectively, annual procurement could reach 100,000 tons, while the Group’s total processing capacity could exceed 200,000 tons per year.
Enhancing Efficiency Through Transparency and Leadership
At the conference, Mr. Tran Thanh Phung, VRG’s Deputy General Director, emphasized the need for transparent, fair, and flexible purchasing policies to build trust with suppliers. He also highlighted the importance of flexible payment procedures and professional conduct among purchasing staff.
Mr. Phung underlined that the long-term effectiveness of the purchasing program depends on organizational restructuring, strategic planning, and personnel quality:
“The capacity of the purchasing team — especially its leaders — is critical. Companies should appoint bold and proactive managers who learn from practical experience. Appropriate allowances and incentives will also strengthen accountability and motivation among employees,” he said.
He added that with favorable market conditions expected in the coming years, the rubber purchasing sector has strong opportunities for growth and expansion within the Group.