In recent years, Vietnam's livestock industry has continuously grown, having an average rate of 4 - 6%/year in the period 2008 – 2018, and increased by 5.5% in 2020. That is the driving force behind the continuous development of Vietnam’s animal feed industry.
According to the Strategy for Livestock Development in the 2021 - 2030 period, with a vision to 2045 of the Ministry of Agriculture and Rural Development, the goal is that by 2030, the total pig herd will be present regularly at the scale of about 29-30 million heads. Of which, the herd of sows will be about 2.5-2.8 million heads, the farm-raised and industrial pig herd will account for over 70%. That goal will continue to be a factor to support Vietnam's animal feed industry to continue to grow in the coming years.
However, Vietnam's animal feed industry still has to import most of its production materials so far. In October and the first ten months of 2021, despite the high price of raw materials in the world, and supply disruptions, Vietnam's imports of animal feed and raw materials continued to increase compared to the same period in 2020.
According to statistics of the General Department of Customs, in October 2021, Vietnam's imports of animal feed and raw materials reached 390.09 million USD, down 5.1% compared to September 2021, but up 22. 6% compared to October 2020. For the first ten months of 2021, imports of animal feed and raw materials reached 4.14 billion USD, up 29% over the same period in 2020. Imports of this product group from most major markets have increased stronger than the same period in 2020.
Import turnover of corn and wheat in the first ten months of 2021 also increased sharply compared to the same period in 2020. In which, import turnover of corn in the first ten months of 2021 increased mainly due to a sharp increase in corn prices, reaching 8.5 million tons, worth 2.4 billion USD, down 14.7% in volume, but up 21.2% in value over the same period in 2020; wheat imports reached 4.1 million tons, worth $1.9 billion, up 62.9% in volume and 84% in value.
The quantity of animal feed ingredients imported to Vietnam annually is pretty stable, remaining at around 20 million tons, including about 9.5 million tons of corn, 500,000 tons of supplementary feed, and about 2 million tons of protein sources. However, statistics from the General Department of Customs show that while the quantity of animal feed import stays the same, the import turnover of animal feed and raw materials increased significantly. The reason lies in an upsurge in animal feed prices.
In October 2021, soybean meal was the highest imported product, reaching 403.07 thousand tons, worth 189 million USD, up 4.7% in volume and 27.1% in value. In the first ten months of 2021, soybean meal imports reached 4.24 million tons, up 2.13 billion USD, down 3% in volume, but up 32.2% over the same period in 2020.
It is forecasted that imports of animal feed and raw materials in the last months of 2021 will continue to increase. The sharp increase in the price of animal feed will partly impact import activities because the livestock industry is affected. Currently, Vietnam's livestock industry is with difficulties when the price of input materials is high, while the price of pork is low, and the demand for livestock products decreases due to the impact of the Covid-19 pandemic.
To assist the livestock industry, the Government issued Decree No. 101, amending and supplementing some articles in Decree No. 122 and Decree No. 57 on export and preferential import tariff rates, the schedule of goods, and the absolute, compound, and out-of-quota import tariff. Accordingly, the most favored nation import tax rate has been adjusted and reduced for some animal feed ingredients. Reducing import tax on ingredients for animal feed will help the recovery of livestock activities in Vietnam, ensuring food supply at the end of the year.
(October 2021)
Source: The Ministry of Industry and Trade
Compiled by VietnamCredit
