News 265 views last update:6 Aug 2012

Vietnam's feed market under pressure

The Vietnam Feed Association has warned that the feed price could increase by another 20%, and if so, Vietnam's husbandry and seafood industries would suffer.

The Ministry of Agriculture and Rural Development (MARD) has a different opinion and said it is not very likely that the feed market will see big fluctuations by the end of the year.
Mid May total areas of soybeans and maize had seen considerable growth in comparison with the same period of 2008.
Maize was grown on 715,000 hectares (+0.7%) soybeans area increased with 17.5% to 129,800 hectares.
According to the Cultivation Department under MARD, Vietnam reaped 18 million tonnes of rice in the winter-spring crop (+0.3%). This means that the volume of husks to be used in animal feed ion the second half of the year will be 2.4-2.52 million tonnes.
Imports of raw materials decreased by 27.8% in the first five months of 2009, with the largest decrease taking place in the first quarter (-37.8%) as a result of the economic crisis that started late 2008.
In April imports recovered again when the government decreased import taxes on raw materials. However fluctuating world market prices and difficulties in purchasing foreign currencies have tempered Vietnamese enterprises to stop importing temporarily.
As such, it is likely that imports will rise again when farmers begin developing their herds of animals again, which will lead to a higher demand for feed, like it did in the second half of 2008.
In Vietnam, if enterprises still find it hard to purchase foreign currencies, while they have to import goods as stocks run out, this will lead to higher production at higher sale prices of products. Then feed prices will not go in accordance with world’s prices, but will increase sharply.

Dick Ziggers

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