Expenses on feed account for 70 percent of the production cost

Poultry and animal imports have been flooding into Vietnam in the last 10 years, but the last three years farmers have seen increased competition. 

The fowl price has dropped dramatically to VND20,000 per kilogram, and sometimes to VND13,000-14,000. The pork price has also plunged from VND50,000 per kilogram to VND25,000.

Ngo Thanh Long, director of a meat import company in HCMC, said animal and poultry meat from other countries has been cheap for many years. Chicken by-products can be imported at low price, while importers just have to pay tax and transportation fees.

Pork imports, about 1,000 tons a month, are mostly sourced from Canada, Germany and the Netherlands. They are priced at $1,200-2,500 per ton, or VND30,000-50,000 per kilogram. Australian and American beef is imported at $2,000 per ton.

Vietnam also imports buffalo meat from India, about 10,000 tons a month. The imports are just $1,200 per ton, or VND30,000 per kilogram. However, it is sold in traditional markets as beef, at VND60,000-70,000 per kilogram.

Meanwhile, domestic products are more expensive, with pork retailing at VND80,000-150,000 per kilogram, beef at VND180,000-260,000 and chicken VND45,000-60,000. 

As domestic products are more expensive, restaurants, street shops and catering companies tend to use imports, forcing the average price down.

Vietnamese products have to compete with official imports but also with products from other sources. In principle, temporary imports must be re-exported later, but they have been sold in the domestic market.

Hoang Thanh Van, head of the Animal Husbandry Department, said domestic meat products are expensive because of high production costs.

Pig farming costs in Vietnam, for example, are 25-30 percent higher than in other regional countries, while poultry farming is 15 percent higher and poultry eggs 12-13 percent more. 

The high feed price and rudimentary farming system are blamed for the high farming cost. However, as the import tariff on feed imports was recently slashed to zero percent from 5-10 percent, the production cost has decreased. 

Pig farming costs in Vietnam have reduced to VND34,000 per kilogram, but it is still VND4,000 per kilogram more than in Thailand.

Pham Duc Binh, deputy chair of the Vietnam Animal Feed Association, said the expenses on feed account for 70 percent of the production cost. Such costs will decrease only when domestic factories can find cheap sources of input materials for feed production. 

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