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Link-chain development is required for a stable livestock industry

​The idea was given by several experts and delegates who presented in the seminar talk about Dong Nai livestock industry in the age of integration held by the Provincial Farmer Association in cooperation with the Journalist Club of Economy (Provincial Journalist Association) on May 26th.


 ​For a more stable development, livestock industry shall be restructured to follow the link-chain format to reduce production prices and create stable demand – supply connection.

 “The battle of prices” can kill livestock industry
 
According to Department of Agriculture and Rural Development (DARD), Dong Nai province is currently having 1.7 million pigs (16.3% less than in Jan, 2017) and 17.5 million chickens. Farm breeding accounts for 69% (with 1,700 farms) while smaller scale breeding takes the other 31% of the livestock industry. The products are mainly consumed in Dong Nai, Ho Chi Minh City, some other provinces and China via cross-border trade.
 
 Mr. Phan Minh Bau - Deputy Director of DARD said that Dong Nai exported 5,000 – 6,000 pigs a day to China before November, 2016; and after which, the number was only 1,400. The accumulated products prices dropped dramatically resulting in significant loss for farmers.
 
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A scene from The Seminar Talk
 

 Mr. Bau assumed the huge loss was caused by not only the output “crisis” but also by the high breeding costs. Small scale livestock farmers depended on packaged livestock food and input material, which accounted for 70% of the breeding cost; and when the products prices drop, they would lose about 14,000VND/kg. Meanwhile, some other farmers who had the advantage of having local food, lost less (about 3,000VND/kg). Large scale breeding farms with disease free guarantee had lower breeding cost as the input food costs were low and the output was stable.

Sharing the same idea, PhD. Kieu Minh Luc – Deputy Director of C.P Vietnam said that Vietnam livestock prices are higher than many countries; especially the countries with copious food supply from livestock industry. And when the European and American countries frozen foods were exported to Vietnam, the national livestock industry could be struggling more. To prevent such the sources of foreign foods, the Government should establish the technical barriers to trade.

From another point of view, Mr. Chung Kim – Representative of Vietnam Livestock Association said that the paradox of the low output prices – high market prices came from the current situation of both farmers and consumers losing too much on the intermediate stages cost. “Too many intermediate stages set the prices at peak; farmers earn much less; consumers have to pay much more than usual; resulting in the market turmoil. In the age of integration, if the livestock industry will fail if we keep operating it with fragmentation.” Mr. Chung stated.

Meanwhile, Mr. Truong Phuoc Dong – Deputy Director of Department of Industry and Trade (DoIT) said that pork is not under the Government obligatory price management but is under the rule of demand – supply and the rule of values. The livestock markets depend on the traders; thus, from the gathering pricing to the retail pricing, there are cost lost to the intermediate stages. This is a difficult to solve issue in market price management.

Livestock Industry Restructuring shall be made

Finding the solutions for the challenges that the livestock industry is facing in the age of integration is not simple. Delegates at the seminar suggest restructuring the livestock industry following the orientation of raising products’ added values. At the same time, make it the link-chain industry from manufacturing to consuming and promote the marketing.

As a large scale farmer, PhD. Kieu Minh Luc said that the breeding method must be changed by reducing small scale farming and outsource farming. Dong Nai livestock industry should be in the link-chain format to maintain good food safety quality control as well as minimum the intermediate stages costs. The most optimized format could be made is the “Breeding food – breeding farm – products manufacturing” closed model. Beside, the market prediction work should be well implemented, livestock industry should be orientated to closely follow the markets demand, avoiding the “supply exceeds demand” and “price drop” situations which caused farmers’ loss.

Mr. Truong Phuong Dong also said that the provincial DoIT had recently cooperated with Ho Chi Minh City DoIT to implement favorable policies to help provincial individuals and operations to bring pork and chicken in to Ho Chi Minh City market and help reduce products’ origins tracking cost.

In the latest event, Dau Day agriculture wholesale market has been put into operation and after fruits and vegetables, more agricultural products are expected to be available in the market in 2018. DoIT will continue promoting marketing, invite domestic and foreign investors in investing and constructing livestock products manufacturing factory as well as supporting farmers in updating markets news and prices.

Talking about the situation of “Gatherers take all, leaving farmers empty hands” in the latest pork crisis, Mr. Truong Phuong Dong said: “DoIT has recently review the current provincial farms situation, farming productivities and the consuming process in each individual small farming household. Only after finding the cause of imbalance prices will we find the solutions. This job is expected to be done by the end of May and then will be planned for detailed solutions and proposed to Provincial People’s Committee and Ministry of Industry and Trade for approval.”

 
Van Gia

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