April 4, 2023

 

High production costs, low retail prices cause massive shutdown of Vietnam's small animal farms

 

 

Hampered by the challenges of falling demand and rising feed prices, small animal farms in Vietnam are calling upon the Vietnamese government for help, specifically, in the form of preferential bank loans and a rollover of debts.

 

Many households in southern Dong Nai Province have stopped breeding altogether — as many as 50% of small breeders in some areas — as they have had to sell at below cost.

 

In a letter sent to Governor of the State Bank of Vietnam Nguyen Thi Hong on March 28, the Dong Nai Animal Husbandry Association asked for emergency rescue policies for the livestock industry.

 

Nguyen Tri Cong, chairman of the association, said the cost of livestock has increased, but retail prices are still low, causing breeders of pigs, cows and chickens to suffer heavy losses. He added that 10 years earlier, Vietnam had 10 million livestock households, but by 2021, there were only four million. Currently, there are less than two million.

 

The association also asked local lenders to consider extending principal debt payments and reduce parts of the interest rate for livestock households.

 

The association reported that it expects local banks to intensify the disbursement of a promised loan package that comes with 2% interest rate support from the state budget. The package was announced by the government in May 2022. However, according to surveys conducted by the association, no businesses or farms have been granted such loans.

 

VnExpress found that many households with flock sizes of less than 20,000 chickens and herds of less than 200 pigs are giving up.

 

Additionally, large-scale animal husbandry enterprises, like CP, Hoang Anh Gia Lai, Vissan and Dabaco have said that raising pigs is no longer profitable thanks to decreasing retail prices.

 

Speaking to VnExpress, Le Van Quyet, vice chairman of the Southeast Poultry Association, said the livestock industry is facing extremely difficult times. The number of households closing their business has increased to 50% of the total and the situation continues to exacerbate. It is forecasted that small-scale chicken farms are in danger of being wiped out.

 

The causes of this situation, according to Quyet, is the increase in the price of feed materials, the low selling price of pig and the African swine fever (ASF) that has exhausted production capacity for some farmers.

 

The mass importing of cheap chicken and pork also led to domestic products being seen as an inferior choice.

 

- VnExpress