VIET NAM - After Tet (Vietnamese New Year) (mid-February), food items returned back to more stabilized prices due to abundant supply and also small traders were back with steady but lower prices, writes Ron Lane, Senior Consultant for Genesus.
According to the survey in a number of markets in Hanoi, prices of fresh food tended to decrease rapidly, more of a reflection of the overall home trade and growth. Consumers’ purchasing power has not increased as projected for the past year.
Specifically, the price of pork fell from 10,000 to 20,000 VND/kg ($ 0.48 US/kg to $0.96 US/kg), with various pork cuts ranging from 80,000 to 150,000 VND/kg ($ 3.84US/kg to $ 7.20 US/kg). Bone-in cuts were from 60,000 to 70,000 VND/kg ($ 2.88 US/kg to $ 3.36 US/kg) a decrease of 20,000 VND/kg ($ 0.96 US/kg) compared with the prices before/during Tet. Pork ribs and pork tenderloins were quoted at 110,000VND/kg ($ 5.28 US/kg) a decrease of 10,000 VND/kg ($0.48 US/kg).
- According to the General Statistics Office, herd cattle across the country expected to reduce about 3-4 per cent compared to the same period last year. For pigs, there is an estimate that the total number of pigs in the country fell by 2-3 per cent compared to the same period in 2012.
- Recently, in mid-March, and in the North part of the country, the price of market pigs averaged around 44,000 VND/kg ($2.11US/kg) while in the South, the average selling price for market pigs ranged from 34,000 to 37,000 VND/kg ($1.63 US/kg to $ 1.78 US/kg). In a recent conversation with farmers at a meeting in Dong Nai near Ho Chi Minh City, the consensus was that they were losing between 300,000 to 400,000 VND/head marketed ($ 14.40US to 19.20US/head).
- Animal feed and raw ingredient prices in Viet Nam for January, 2013: the price for most ingredients was only adjusted one time during the month. There was an increase of 600VND/kg ($0.03 US/kg) for bran concentrate and 260VND/kg ($0.01 US/kg) for mixed corn and bran concentrate. Price of soybean oil was at 16,100 VND/kg ( $ 0.774 US/kg), an increase of 15.2 per cent; cassava 5,565 VND/kg ($0.268 US/kg), an increase of 6 per cent; 6,720 rice bran/kg ($ 0.323US/kg), an increase of nearly 10 per cent compared to December 2012.
- It is expected to be a difficult year for the animal feed industry in Viet Nam. The expected ingredient prices will not decrease and the domestic demand could increase significantly. Overall growth in the animal feed industry depends on two factors:
- Growth of the livestock sector
- The supply of inputs.
Only some materials can be produced and sourced within the Country-such as corn, cassava, rice bran and fish meal. However, the total production of these feed ingredients is still limited. Therefore, in the coming years, the animal feed manufacturers must still depend heavily on imported raw materials within a global pricing structure.
- Generally, the price of animal feed and raw materials in the world as of the end of January were down slightly due to the decrease in the average price of corn, soybean and wheat. However, the price of fish meal reached a record high brought on by adverse weather elements in the two countries- Peru and Chile- that produce significant amounts of fish meal.
- The country has 2 areas with PRRS: Quang Nam and Long An provinces. Avian influenza and foot and mouth disease seems to be under control in the Country.
- Consumer Price Index (CPI) in February increased by 1.32 per cent from the previous month, this is the lowest compared to the growth rate of most averages for the month of February. The monthly price index rose mainly due to food prices. Food prices in most commodities rose due to consumer demand for the Tet Holiday.
The CPI in February also increased by 2.59 per cent compared with the end of December, 2012 and increased by 7.02 per cent compared to the same period last year. The average CPI for the first 2 months of 2013 saw an average increase of 7.04 per cent compared to the same period in 2012.
What to look for over the next few months
Dr. Nguyen Dang Vang, Chairman of Viet Nam Animal Breeding Association (VABA) recently quantified that the Country’s animal husbandry sector lost about $861 million USD during last year (2012). Factors such as the huge increase in the price of feed ingredients and complete feeds along with higher utility costs (especially electricity) plus increased cost for labour were the principal causes for the increases. On top of this, the local farmers dealt with widespread diseases including avian influenza in poultry and PRRS and Foot-and-mouth in swine. Dr. Vang strongly suggests that the state agencies should focus on better measurements to control animal diseases and to enhance food hygiene and safety at slaughterhouses.
In 2012, Viet Nam produced 12.7 million tonnes of feed which is an increase of 10.43 per cent over 2011. Of this total, about 56 per cent was commercial animal feed prepared by feed millers. More than 52 per cent of this commercially prepared feed was produced by foreign owned feed mills. Joint venture companies manufactured 6 per cent and the local owned feed mills produced the balance of about 42 per cent. CP Viet Nam produced 2.3 million tonnes (18.1 per cent of the total produced) followed by Proconco which produced 1.1 million tonnes (8.7 per cent) and Cargill Viet Nam which produced 0.99 million tonnes (7.8 per cent of market share). The total purchased ingredient cost for the Country last year was 2.46 Billion USD which is up 3.5 per cent from 2011.
Pham Van Du, Deputy Director of Crop Production Department. Under the Government's Corn Development Sector, recently announced that Viet Nam is focusing on boosting both corn acreage and yield to offset the demand for corn imports. A strategy to increase the total corn production by nearly 70 per cent to 7.5 million tonnes per year is the target for 2020 (1.3 million hectares with an average yield of 5.8 tonnes/ hectare). This 7.5 million tonnes would meet about 80 to85 per cent of the corn for livestock production. Investment in research and development on high-yielding corn varieties will also be enhanced.
|Genesus Global Market Report|
Prices for the week of March 11, 2013
(Liveweight a lb)
|USA (Iowa-Minnesota)||73.45 USD/lb carcass||54.35¢|
|Canada (Ontario)||1.43 CAD/kg carcass||50.75¢|
|Mexico (DF)||18.10 MXN/kg liveweight||66.28¢|
|Brazil (South Region)||3.02 BRL/kg liveweight||69.17¢|
|Russia||72 RUB/kg liveweight||$1.06|
|China||13.37 RMB/kg liveweight||97.62¢|
|Spain||1.377 EUR/kg liveweight||80.76¢|
|Viet Nam||38,500 VND/kg liveweight||83.46¢|
|South Korea||2,730 KRW/kg liveweight||$1.11|
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