Source: World Bank
Consumption of meat in Vietnam has increased significantly over the past decade, with annual per capita consumption increasing from 33kg in 2009 to 40kg in 2018. Fueled by growing income as well as growth in population, it forecasted that the demand for livestock will experience good growth till 2024.
Pork will account for more than 70% of total meat consumption; however, growth in poultry and beef consumption will outperform the current low level.
In Vietnam's livestock industry, pig farming is by far the most dominant sector, with pork production accounting for nearly 80% of total meat production in 2017. Poultry will record the strongest growth in production and consumption in the coming years.
The pork industry boomed in the 2000s before stagnating over the past 10 years as rising feed costs (due to limited domestic supplies and import controls). Poor yields have also limited the expansion of pork production. The outbreak of African Swine Fever in 2019 have reshaped the industry, promoting consolidation and industrialization.
Beef production have benefited from the growth of the dairy industry.
In terms of trade, Vietnam started importing meat in 2006, and imports have steadily increased since then. Consumption will continue to grow at a faster rate than production, and import of this item is forecast to increase in the coming years, especially for poultry and beef.
Deficit in poultry production will reach about 200,000 tons in 2024, compared with 66,000 tons in 2018. That in beef will reach 92,000 tons in 2024. Demand for pork, in general, is still met.
Besides the strengths and potentials, the livestock industry in Vietnam is still faced with many challenges. Firstly, the production system has not been synchronized, and there has been no link from production to consumption.
Prices of finished product are still high. There have not been many brand names and advertising activities. Therefore, many good products are not known and trusted by consumers.
One of the reasons for the high cost is that animal feed, breeders or veterinary drugs still have to be imported. Along with that, the production scale is still small and medium, unable to apply modern technologies to increase productivity and quality.
On top of that, livestock farms and enterprises do not know how to export this potential products. In contrast, foreign products easily flood into Vietnam with good quality and cheaper prices.
In Vietnam, “dirty food” has been a major social problem because producers and businesses want to gain more profits by using banned substances to increase weight of livestock, poultry. They even turn smelly dead livestock into delicious food. This makes consumers more afraid of using domestic products, thereby causing more difficulties to production and consumption.
Despite many limitations and difficulties, the livestock industry still plays an important role in Vietnam's economy. The State and the breeders themselves need to make more efforts to promote the strong development of Vietnam's livestock industry, meeting domestic and export demand.
Vietnam's meat consumption offers attractive opportunities. This market will be one of the fastest growing and diversified in meat consumption in the coming years with. Development of the livestock industry is driven by strong GDP per capita growth and rapid urbanization. Besides, Vietnam has no cultural barriers to meat consumption.
Compiled by VietnamCredit