ShapeShapeauthorShapechevroncrossShapeShapeShapeGrouphamburgerhomeGroupmagnifyShapeShapeShaperssShape

Vietnam Livestock and Products Annual - September 2005

by 5m Editor
1 September 2005, at 12:00am

By USDA, Foreign Agricultural Service - This article provides the pork industry data from the USDA FAS Livestock and Products Annual 2005 report for Vietnam. A link to the full report is also provided. The full report includes all the tabular data which we have omitted from this article.

Report Highlights:

Vietnam's livestock in 2004 had a growth rate of 2.3%. This was significantly lower than in 2003 due to highly pathogenic avian influenza outbreaks. However, Vietnam has been trying the best to recover the poultry sector from this outbreak. Post estimates that Vietnam's livestock sector will still grow at a 4% growth rate in 2005.

Production

The Ministry of Agricultural and Rural Development (MARD) reported that Vietnam’s livestock production value as a proportion of the total value of Vietnam Agriculture production increased from 17% in 2001 to 22.4% in 2004. MARD hopes the country can raise this livestock proportion livestock to 30% by 2010.

Vietnam’s livestock in 2004 had a growth rate of 2.3%. This was significantly lower than in 2003 due to highly pathogenic avian influenza outbreaks.

Post estimates that Vietnam’s livestock sector will grow at a 4% growth rate in 2005 as Vietnam has been trying the best to recovering from the avian influenza outbreak. MARD estimates Vietnam’s 2005 animal meat production (live weight) at 2,800 thousand metric tons (TMT), about 11.7% higher than 2004’s production (see table 2). Pork plays a dominant role in total livestock production. Currently, about 80% of the meat production is pork while the share of poultry meat is about 12.8% and other kinds of meat including beef, buffalo, and goat meat occupy only 7.2%.

In Vietnam, per capita meat consumption is increasing. Annual per capita meat consumption (live weight) in Vietnam increased to 31.3 kg in 2004 as the income levels of Vietnamese people are improving. MARD estimates that 2005 per capita consumption will be about 35 kg/head/year, up significantly from 23 kg in 2000.

Prices

Post estimates prices of livestock in domestic market in 2005 will increase significantly because of high demand and the continued impact of the bird flu in 2004 and 2005. The supply of poultry meat decreased sharply in 2004, which made chicken meat prices increased 20%-30% compared with 2003.

Annual average price of pork (live weight) in 2004 was VND 14,800/kg (live weight). The average pork price in southern Vietnam was VND 15,550 per kg, equivalent to US$ 1.00, and in northern Vietnam was VND 14,000/kg equivalent to US$ 0.9.

In the Vietnamese diet, fresh pork meat is the most common animal protein source. Now Vietnamese people in cities are also consuming more processed pork (canned meat or prepared sausages). However, legal imported pork products are still not widely available in Vietnam.

Domestic pork prices

By the end of 2004 and in the first six months of 2005, domestic pork prices increased sharply in both northern and southern provinces due primarily to the impact of bird flu.(see table 8). However, after peaking in February of this year in northern province and in June in southern provinces, pork prices have been dropping as the bird flu situation has improved and higher prices have prompted swine producers to increase production.

Trade

Although the Vietnamese government has plans to increase pork exports to 80,000 tons this year and 100,000 tons for years afterwards, exports continue at the 10,000–30,000 tons only, worth US$16–48 million /year.

Vietnam pork meat does not compete effectively in the international market. Health restrictions related to both animal and human health close many markets to Vietnam. Vietnamese pork is also not usually lean enough to compete overseas. The lean meat ratio of live pigs is still very low (about 33.6% - 40.6 % in the north and 34.5%-42.6% in the south of Vietnam) while international markets require leaner meat ratios.

MARD plans to support industrial style farms, encourage production with good quality breeds and lower export prices. Vietnam imported very high quality pork breeds from USA (for the northern provinces) and Australia (for southern provinces) such as: Landrace, Yorkshire, Duroc that will produce pork with lean meat ratios up to 56-60%. However poor intellectual property rights protection in Vietnam limits the degree to which foreign breeders are willing to provide genetics to the country.

The United States has exported live pigs to Vietnam for recent years. The value and volume of U.S. live swine, which were exported to Vietnam during the period of 2000 – 2004, are stated in table 9. In 2004, the number of live swine imported from the United States decreased significantly to 110 head, a 50% decrease compared with the previous years. During the first five months of 2005, Vietnam has not imported any live swine from the United States.

Illegal import of pork meat and live pigs from China difficult to control

While Vietnam tries to boost its production to meet domestic consumption and the government’s export plan, in fact there were illegal imports of pork meat and live pigs from China, which are difficult to control. These imports meet a strong and growing domestic demand, especially in provinces bordering China.

Animal Feed

Vietnam’s 2003 commercial animal feed production was up by 14% but due to the avian influenza outbreak, the 2004 increased only slightly compared with 2003’s total commercial feed production, of which 73% is compound feed and 30% is concentrate.

Post estimates that Vietnam must have about 11 – 12 million tons of animal feed to produce over 2,600 thousand tons of livestock production by 2005 and 13-15 million tons by the end of 2010.

Vietnam’s domestic price of animal feed has remained high

Reportedly, the price of animal feed in April 2005 increased by 20% in comparison with the same period of last year due to higher soybean and corn import prices. Corn prices increased by 30%, from VND 1,900/kg to VND 2,700/kg in northern provinces and to VND 2,500/kg in southern provinces. Lysine import prices also increase by 5-10%.

Furthermore, bad management and distribution systems in Vietnam’s markets are also to the causes of high prices of animal feed. Normally, first sales agencies add 10-12% to the original prices and second sales agencies also add 10-12%. Therefore livestock farmers face a 20-24 % increase in the price of animal feed, leading to higher production cost.

Vietnam continues to import animal feed and materials

The Vietnamese animal feed production sector in Vietnam is now relying heavily on imported feed ingredients. Vietnam imports 60% of the materials, including maize, soybean meal, fish meal, meat & bone meal, rice bran, wheat bran, pre-mixes and vitamins needed to produce animal feed locally. In total, the whole sector annually imports 40% of maize, 80% of soybean meal and 50% of fish meal required for feed production.

In 2004 Vietnam spent US$ 478 million on imports of animal feed and materials. In the first six months of 2005, Vietnam spent US$ 319 million a 54% increase compared with the same period of 2004.

Vietnam’s 2004 imports of soybean meal are estimated at 890 TMT, a decrease of 11% from 990 tmt imported in 2003 due to the impacts of the avian influenza outbreak. However, the imports of soybean meal are expected to continue to increase in the future due to limited local production of soybeans and continued expansion in the livestock and fish sector. With no commercial crushing facility in Vietnam, soybean meal imports will continue to be a necessity. There is no import duty for soybean meal.

Vietnam imports animal feed and materials from different countries including China, Thailand, the Netherlands, England, France and the United States.

Animal feed processing industry

As of May 2004 according to MARD’s data, there are 196 animal feed and premix manufacturers operating in Vietnam, of which there are 44 animal feed mills producing premix animal feed and 138-152 mills (to produce both compound and concentrate feed). Among 196 animal feed mills, there are 65 mills that belong to the Vietnam Animal Feed Association. The total capacity of Vietnam’s animal feed mills is estimated at 5.4 million metric tons (MMT). The most animal feed mills are located in southeastern Vietnam These account for 42.8% of all meals in the country and nearly 40% of total animal feed production. The Red River Delta in the north of Vietnam accounts for 26.1% of mills and 35.4% of production.

Key feed milling companies include foreign invested companies such as CP Group (Thailand); Proconco (France); Cargill (USA); TTC (Taiwan); New Hope (China) and Cheil Jedang group (South Korean) along with a number of Vietnamese companies such as DABACO (Bac Ninh), VINA, Thanh Binh, Long Chau (Dong Nai), VIC (Hai Phong), Hoan Duong (Hanoi), NOPICO An Khanh, Ngoc Hoi Animal Feed Mill, and AFIMEX (An Giang).

Further Information

To read the full report please click here (PDF format)

Source: USDA, Foreign Agricultural Service - Annual Livestock and Products Report - September 2005