September 20, 2013

From January to August this year, Vietnam has spent US$2.09 billion on raw animal feed material imports, a 41.1% increase on-year.

Key imports are corn (1.34 million tonnes) and soy (897,000 tonnes). Materials are mostly sourced from Argentina (25.6%), India (14.6%), US (14.5%), followed by Italy, Thailand and China.

Mai Van Chung, purchasing director of the Japfa Cornfeed Viet Nam Ltd Co, said the firm has signed a contract to import 80,000 tonnes of corn for the production of animal feed by March 2014.

Chung said that Japfa needs at least 16,000-17,000 tonnes of corn every month. The company used to import sufficient volume for a certain period but at the present time, they import a bigger volume to take advantage of the very cheap prices of corn on the South American market.

The director also said that the company preferred imports of superior quality with a much lower humidity rate than locally-processed corn.

The imported corn prices from Argentina and Brazil were about US$310-320 per tonne in June but the price has now dropped to US$245-250, lower than the local price of US$295 per tonne (quoted in Son La province).

In fact, raw material prices for animal feed production are falling on the global market but are at a standstill high in Vietnam, disinteresting domestic animal feed producers.

Vice Chairman of the Vietnam Animal Feed Association Nguyen Duc Binh said that local manufacturers were still processing high-value imported materials and the output prices would bear a certain delay on the way down.

Binh said the price of local animal feed might fall next month, at around 5% against the current price.