Farms under threat as ASF fails to ease

The continuing threat of African swine fever is showing no signs of retreating, pushing livestock farming and animal feed production companies into huge difficulties and even danger of ­bankruptcy.

farms under threat as asf fails to ease
Healthy pigs are now being sold at a cheaper rate, putting pressure on the entire industry

Pham Van Luong, a pig feed salesman in Hai Hau district of the northern province of Nam Dinh, said that his family previously sold an average of 20 tonnes of rice bran per month. Since the outbreak of African swine fever (ASF), over the past three months they have managed to sell just five or six tonnes of animal feed per month.

“I sell animal feed and bran on credit to farmers. However, for some months now, pigs have been infected and culled, and farmers have no money to pay me. Currently, I am owed nearly VND2 billion ($87,000),” said Luong.

Dao Van Bac, director of BB Sun Vietnam Co., Ltd. which manufactures animal feed in the northern province of Hai Duong, said, “While our company supplied around 2,000 tonnes of animal feed monthly to the market before ASF, it has reduced to 1,200-1,400 tonnes now. We have already decreased the price by VND5,000-10,000 ($0.21-0.43) for a package, but the demand of the market still does not raise. So our company reduces productivity to decline inventory.”

The disease, which has killed nearly three million pigs, also significantly impacts the business of Thai-owned C.P. Vietnam, the biggest player in the Vietnamese animal feed production sector. “The farming industry is facing many challenges including the fall in pork prices, the increase of production costs of preventing disease, and difficulty in finding our consumption market among other things,” a C.P. Vietnam representative told VIR.

Discussing with VIR about the epidemic, a representative of Australian-backed Mavin said that ASF has not caused any direct damage to animals in Mavin’s farms so far. However, the disease also creates numerous challenges for the company, including reducing growth speed. “Some farms of ours in epidemic areas must stop farming after selling in order to prevent the fever hitting,” said the representative.

Mariano Berdegue, managing director of US-backed Cargill Feed & Nutrition in Thailand and Vietnam also told VIR, “Like any other players in the industry, Cargill has been impacted by ASF as swine feed volume has been decreased due to the reduction of pig population because of the ASF outbreak. However, swine feed is one among many animal nutrition products and solutions we are providing to the Vietnamese market, so we continue to keep ourselves focused to serve customers.”

According to Tran Trong Quang, deputy general director of Vinafeed Group, over the past three months, the company’s feed consumption has decreased by about 30 per cent compared to January, from 16,000 tonnes monthly to 11,000 tonnes. Vinafeed’s product prices have also fallen by 7-8 per cent compared to January.

“Many livestock households are selling healthy pigs at any price, and are even selling sows. Therefore, the domino effect could bankrupt the system of breeders, breeding animal providers, and rice bran distribution agents even after the epidemic ends,” Quang said.

According to the US Department of Agriculture, ASF will drive down the demand for animal feed in Vietnam from 23.8 million tonnes in 2018 to 23.7 million tonnes in 2019 and 23.5 million tonnes next year. Meanwhile, Pham Duc Binh, vice chairman of the Vietnam Animal Feed Association, said the production of animal feed has fallen by at least 30 per cent.

 

In addition to farmers selling off all their pigs, it remains uncertain about how the disease is spread. This is causing concern regarding ingredients of feed such as meat bone powder.

In order to minimise the ability of spreading ASF, the Ministry of Agriculture and Rural Development has already prohibited the import of material of meat and bone powder from ASF-diagnosed countries. According to the C.P Vietnam representative, this company has already removed meat and bone powder from its animal feed ingredients.

According to the General Department of Vietnam Customs, in the first five months of 2019, Vietnam spent over $1.61 billion importing raw materials for animal feed production, an on-year increase of 0.3 per cent.

Currently, agricompanies are focussing more on developing chicken, duck, and aqua farming as well as producing feed for poultry, aqua, and beef in order to boost production. This is considered the only solution for these companies in the context of the continuing epidemic.

farms under threat as asf fails to ease
Mariano Berdegue, Managing Director, Cargill Feed & Nutrition, Thailand and Vietnam

African swine fever (ASF) was first diagnosed in Vietnam several months ago and has been spreading ever since. How would you assess the impacts and damage wrought by ASF in the local husbandry industry?

When ASF was identified in China last summer, Rabobank predicted that this virus spreading would change the whole landscape of meat production worldwide. This was proven to be true and is the worst swine epidemic in recorded history. ASF has spread to Cambodia, Laos, Hong Kong, North Korea and to 58 of 63 provinces in Vietnam. The spread in Vietnam has been specially aggressive and fast, leaving thousands of farmers devastated. Without doubt, ASF will drive down demand for animal feed in Vietnam as the pig population is shrinking by at least 7% as reported recently by the MARD. Many livestock households are selling uninfected pigs at any price, regardless the pigs are fully grown or not, and are even selling sows. ASF will significantly change the livestock market as thousands of small scale farmers are driven out of business and larger commercial farmers continue to grow and integrate. At the same time, pork shortage will create unmet demand which will in turn drive growth of the poultry sector.

Cargill is considered a heavyweight in the industry. How did the ASF impact your production and business? How did your revenue and production change after ASF?

Like any other players in the industry, Cargill has been impacted by ASF as swine feed volume has been decreased due to the reduction of pig population because of ASF outbreak. However, swine feed is one among many animal nutrition products and solutions we are providing to the Vietnamese market so we continue to keep ourselves focused to serve customers; and at the same time taking a lot of actions to help our customers improve their biosecurity to protect against ASF and find opportunities to recover. On our end, we have tightened biosecurity measures throughout our supply chain from feed ingredients, production to warehouse and delivery to customers to make sure the feed we are supplying is of the best quality and safe for animals. We also adopted the latest technologies in feed to increase overall health for pigs across their lifecycle so that they can be better protected from diseases. To the dealers and farmers, Cargill has been providing a lot of training and on-site support to help them enhance farm and biosecurity management, efficiently use disinfectants, increase farm hygiene, use proper farming equipment and apply the right feeding programs to enhance animals’ health. We also sponsored disinfectants to departments of agriculture and rural development in some provinces where ASF is largely outbreaking to help them enhance biosecurity in the region.

In your opinion, why has the country been unable to bring ASF under control? Has Cargill changed focus on other sectors instead of pig farming?

The animal farming sector in Vietnam is highly fragmented and there are more than 2 million small holders, many of them are still raising pigs in “traditional way” which means the pigs are on one hand fed with left-over food of humans without proper cooking or processing, on the other hand not properly protected by biosecurity measures. The rapid spread of African Swine Fever demonstrates Vietnam’s vulnerability in terms of biosecurity and overall farm management practices.

As a company with many years’ experience in livestock farming and disease control in many countries and territories, we always hold ourselves responsible not only for providing safe and high quality feed to customers but also for helping them develop sustainable and highly productive farming. In this difficult situation, we are even more committed to delivering safe feed to animals and at the same time accompanying farmers in enhancing biosecurity through training and education programs, disinfectant support, etc. to help them protect their herds against ASF and other diseases.

According to the General Department of Customs, the import turnover of animal feed and feed ingredients in the first five months still increased lightly, while the consumption of pork (and pig feed) has dropped by 30-50 per cent. How do you deal with the excess animal feed and materials?

At Cargill, we have very good sourcing, demand planning and risk management capabilities so that we can efficiently control our entire supply chain to make sure we do not overstock materials or complete feed in our warehouses and throughout the distribution channels. This is to make sure of cost efficiency and the best quality of the feed that we provide to farmers. VIR

Nguyen Huong

ASF hits largest-ever pig farm in Dong Nai

ASF hits largest-ever pig farm in Dong Nai

Dong Nai Province has uncovered another case of African swine fever (ASF), at Phu Son Livestock JSC’s pig farm, which holds 20,000 pigs, in Trang Bom District, the local media reported.  

VN Government calls for drastic measure to fight ASF and ensure food safety

VN Government calls for drastic measure to fight ASF and ensure food safety

The Government has instructed ministries and local governments not to ease up on the fight against African swine fever which has now spread to 34 provinces and cities.  

PM Nguyen Xuan Phuc requests entire political system to join ASF combat

PM Nguyen Xuan Phuc requests entire political system to join ASF combat

Prime Minister Nguyen Xuan Phuc has called for joint efforts of the entire political system in the fight against African swine fever (ASF) which has spread across 34 cities and provinces nationwide.  

 
 

Other News

.
ASEAN membership fuels Vietnam’s trade with regional markets
ASEAN membership fuels Vietnam’s trade with regional markets
BUSINESSicon  29/07/2020 

Vietnam’s participation in ASEAN 25 years ago has helped the country enjoy strong growth in trade with other member nations.

Despite Covid-19, Vietnam exporters still find new markets
Despite Covid-19, Vietnam exporters still find new markets
BUSINESSicon  29/07/2020 

Vietnam’s fruit exporters has been striving to sell to new markets because they understand that reliance on the Chinese market will bring high risks.

Garment, footwear and woodwork companies look forward to receiving orders in H2
Garment, footwear and woodwork companies look forward to receiving orders in H2
BUSINESSicon  29/07/2020 

After half a year of struggling to survive difficulties caused by Covid-19, Vietnamese enterprises are hoping that more orders will come over the next six months.

Banks face exchange-rate risks when issuing international bonds
Banks face exchange-rate risks when issuing international bonds
BUSINESSicon  29/07/2020 

Many commercial banks have presented plans at shareholder meetings to issue bonds in the international market.

Face mask prices on the rise
Face mask prices on the rise
BUSINESSicon  29/07/2020 

The price of medical masks is on the rise after two new COVID-19 cases were confirmed on Sunday evening, bringing the total number of community infections linked to Da Nang and Quang Ngai to four in the past three days.

Group set up to inspect VN pork market
Group set up to inspect VN pork market
BUSINESSicon  29/07/2020 

The Ministry of Industry and Trade has founded a group to inspect the pork market which saw prices at high levels since the end of 2019 despite the Government’s effort to increase supply to make up for the drops caused by African swine fever.

First protocol amending ASEAN Trade in Goods Agreement approved
First protocol amending ASEAN Trade in Goods Agreement approved
BUSINESSicon  28/07/2020 

The Government has issued a resolution approving the first protocol that amends the ASEAN Trade in Goods Agreement (ATIGA).

VN securities firms enjoy strong Q2 gains
VN securities firms enjoy strong Q2 gains
BUSINESSicon  28/07/2020 

After touching bottom in the first quarter of 2020 because of COVID-19, Vietnam’s stock market staged a strong comeback in the following quarter, allowing securities firms to enjoy sharp increases in both revenue and profit.

Local airlines open new domestic air routes to increase revenue
Local airlines open new domestic air routes to increase revenue
BUSINESSicon  28/07/2020 

To offset the decline in revenue from international flights, airlines have been trying to exploit more domestic air routes.

Vietnam's trade surplus continued to grow in H1 despite Covid-19
Vietnam's trade surplus continued to grow in H1 despite Covid-19
BUSINESSicon  28/07/2020 

The trade surplus soared in the first six months, though the GDP rate grew by only 0.36 percent in Q2 as Covid-19 escalated in many countries.

VN banks still make high profits, though businesses hit hard by Covid-19
VN banks still make high profits, though businesses hit hard by Covid-19
BUSINESSicon  28/07/2020 

Applying drastic measures to cut costs and ease reliance on capital sources, commercial banks continued to make profits in the first half if the year, However, they have been warned of bad debts ahead.

Vietnam's catfish industry experiencing tough days, no improvement expected this year
Vietnam's catfish industry experiencing tough days, no improvement expected this year
BUSINESSicon  28/07/2020 

Catfish products saw the strongest decline among seafood exports in the first six months of the year. With weak demand, a gloomy year is anticipated for the industry.

Gold prices hit all-time high
Gold prices hit all-time high
BUSINESSicon  27/07/2020 

Gold prices soared near VND57 million (US$2,486) per tael (1.2 ounces) on the local market on first day of the week while the yellow metal also made its history in prices, hitting an all-time high.

Hanoi removes barriers to investment in high-tech agriculture
Hanoi removes barriers to investment in high-tech agriculture
BUSINESSicon  28/07/2020 

Hanoi’s farming sector has proposed that the city adjust the mechanisms and policies to promote marketing and branding of high-tech agricultural products.

Resurgence of Covid-19 further thwarts Danang's economic recovery
Resurgence of Covid-19 further thwarts Danang's economic recovery
BUSINESSicon  27/07/2020 

The complicated progression of Covid-19 in Danang has dealt a blow to the city’s efforts to grow its economy this year and may drag Vietnam's economic recovery.

Asia-Pacific investment volumes in real estate fall due to COVID-19
Asia-Pacific investment volumes in real estate fall due to COVID-19
BUSINESSicon  28/07/2020 

Asia Pacific’s commercial real estate market has felt the brunt of COVID-19 so far this year, with a sharp decline in investment volumes and rental prices across most major commercial asset classes, according to real estate services firm JLL.

Organisations rush to sell Sacombank shares to retrieve debts
Organisations rush to sell Sacombank shares to retrieve debts
BUSINESSicon  27/07/2020 

Some organisations have rushed to sell shares of Sai Gon Thuong Tin Commercial Joint Stock Bank (Sacombank) to retrieve bad debts, but it was not easy to find buyers agreeing with the offered price.

VN stocks under pressure as virus cases weigh on market sentiment
VN stocks under pressure as virus cases weigh on market sentiment
BUSINESSicon  27/07/2020 

 Vietnamese shares are on the edge of declining this week as worries about the second wave of coronavirus spread increased after new cases were reported over the weekend.

Increase in M&A deals looks imminent in property sector
Increase in M&A deals looks imminent in property sector
BUSINESSicon  28/07/2020 

Many analysts think now is a good time for investors looking for acquisitions in the property industry to act since difficulties caused by the Covide-19 pandemic have thrown up opportunities.

VN law should be changed to better protect online consumers
VN law should be changed to better protect online consumers
BUSINESSicon  27/07/2020 

Attending a workshop discussing the laws held by Vietnam Consumer Protection Association in Ha Noi last week, experts said more effective solutions are needed to protect consumers.

 
 
 
Leave your comment on an article

OR QUICK LOGIN