Vietnamese imports of soymeal for animal and fish feed may rise to a record, making the country Asia's biggest importer alongside Indonesia, according to a report by the US Foreign Agricultural Service.

 

Imports may expand 5% from last year to 2.6 million tonnes, the report said.

 

Soymeal purchases by Vietnam have tripled since 2002 as the country's imports overtook Thailand, South Korea, the Philippines and Japan.

 

Purchases are at a high level because of demand from the pork, poultry and aquaculture feed industries," Nguyen Huong of the agricultural attaché's office said

 

Seafood was Vietnam's fourth-biggest export in the first quarter this year, with shipments rising 15% from a year earlier to US$861 million, according to the General Statistics Office in Hanoi.

 

Vietnamese cattle meat production almost doubled between 2003 and 2008, while pork output rose 42% in the same period, according to figures from the Food & Agriculture Organisation of the UN.

 

"Soymeal is fundamental to many agriculture-related industries in Vietnam," said Andrew Speedy, the FAO's chief representative in Hanoi. "There is the potential to expand soy production here, but there's still no capacity for soy processing."

Vietnamese government plans to increase production of oilseed crops, including soy, are being hampered by high input costs and low yields, according to Huong.

 

"Farmers have no economic incentive to expand their production areas," Huong said. "The first commercial crushing facility in Vietnam will not begin operating at full capacity until the third quarter of 2011."

 

India and Argentina are the top suppliers of soymeal to Vietnam. Shipments from India slumped 42% last year to 1.01 million tonnes, while Argentine exports more than doubled to 984,000 tonnes, according to the US report.

 

"This shift was due to the combination of cheaper freight rates available from Argentina as ships sought to pick up back-haul cargoes at reduced prices and the higher quality of Argentine meal compared with Indian meal," Huong said.

 

"India will remain the leading supplier of soymeal because of its shorter transport time, but both the US and Argentina are gaining market share because of quality," he added.