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Difficulties surround the livestock industry

According to Deputy Minister of Agriculture and Rural Development Phung Duc Tien, many forecasts show that Vietnam's economy will grow again from the second quarter of 2023 and this is the driving force to help to restore purchasing power. The Ministry of Agriculture and Rural Development has strongly directed the development of livestock feed material area including corn and tapioca in the Central Highlands to reduce import dependence. In addition, the management agency has actively supported enterprises with procedures for exporting livestock products.

​During a long time, the products of many key livestock items in the province like pigs, chickens, etc., were sold to the market much lower than the production cost. It is forecasted that the livestock industry is still difficult to prosper again in 2023.

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A pig farm at Thien Tan commune, Vinh Cuu district

Accordingly, from enterprises to livestock households are all struggling to survive in difficulties.

Struggling to bear the loss

Over the past year, even in the peak consumption season like the Lunar New Year 2023, the price of many livestock products such as pigs and chickens is still sold below the production cost which is the reason why it is facing difficulties from small farming households to large enterprises.

Mr. Duong Anh Tuan, Director of Binh Minh Livestock Co., Ltd. compared, the production cost of colored hair chickens is currently from 39 to 43 thousand VND per kilogram but the recent selling price is only from 33 to 37 thousand VND per kilogram; The cost of industrial chicken is more than 30,000 VND per kilogram, but now the selling price is just over 20,000 VND per kilogram. The enterprise has suffered continuous losses since December 2022 up to now and the enterprise is currently at a stalemate because output prices have never been able to prosper while the cost of animal feed is constantly increasing. This is also the reason why the total size of the enterprise's herd is only about 200,000 chickens while the previously raising were 2 million chickens before.

Mr. Nguyen Kim Doan, Deputy Chairman of the Provincial Livestock Association said that the disease situation in livestock was still quite complicated, which was also one of the reasons contributing to higher livestock prices. If the loss continued for a long time, it was sure that the total livestock herd in the province would decrease, affecting the supply for the market in the coming time.

Analyzing the difficulties of farmers, Mr. Duong Tat Thang, Director of the Department of Livestock Production (MARD) pointed out, not only in Vietnam, but also in other countries, the price of live pigs has also decreased, even stronger than in Vietnam. Specifically, in China, the price of live pig in October 2022 was 87,000 VND per kilogram but it was now only about 53,000 VND per kilogram even though the country has reopened.

Expecting the price of animal feed to cool down

In addition to the expectation that the price of livestock products will increase again, reducing input costs, especially the price of animal feed is said to be a solution to overcome difficulties for the livestock industry.

Mr. Pham Van Dao, owner of a pig farm at Vinh Tan commune (Vinh Cuu district) worries that, in previous years, live pigs sold for about VND 50,000 per kilogram making good profits for farmers. But now, the price of live pigs is more than 50,000 VND per kilogram, but farmers have lost millions of VND per pig. The reason is due to high input costs and mainly because the price of animal feed has increased many times compared to before. The biggest difficulty that needs to be removed is the continuously increasing price of animal feed.

In response to this issue, Mr. Duong Tat Thang, Director of the Department of Livestock shared that the good news is that the current price of animal feed ingredients in the world has also fallen to the lowest level in the past 19 months. Currently, most of Vietnam's import tax on animal feed ingredients has been reduced to 0%; only for dry goods, soybean oil is still subject to the tax rate of 2% and is being proposed to be reduced to 0%. It is hoped that by the second quarter of 2023, the price of animal feed in Vietnam will decrease, partly removing difficulties for livestock and poultry raising households.

From the perspective of an investment enterprise, Ms. Nguyen Thi Huong, Director of Huong Vinh Cuu One Member Co., Ltd (Vinh Cuu district) shared: "Despite difficulties, businesses still strive to maintain a total herd of 600,000 pigs. Responding to difficulties, the business saves the most in all input costs, not reduce production because we have to ensure the lives of the workforce".

According to Ms. Huong, the more difficult it is, the more business care about product quality to retain customers. The enterprise with herbal pork product is well appreciated by the market, but the high production cost is a difficult point for the enterprise to promote this product line. Accordingly, the business is looking for solutions to reduce the cost of raising herbal pigs like actively growing herbs at the farm. In addition, the enterprise is completing the closed chain from breeding to slaughter, being flexible in distribution to the market. In addition, from 2022, the enterprise will invest in developing more products processed from pork materials. The enterprise is also upgrading the production process and quality so that the product is qualified to participate in the export market.​​

Author: Phan Anh

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