June 4, 2008

Vietnam's chicken farmers report more losses on high feed costs

Vietnam's poultry farmers are reporting losses of as much as VND200 million, with feed prices going up for the fifth time so far this year.

Phuong Nguyen, a poultry farmer in Dong Nai province, said she has lost around VND200 million, with most farms incurring similar losses.

If feed prices continue to rise, most of the farms would have to close down, she added.

Last week, the cost of a 25-kilogramme bag increased by up to VND7,500 to around VND160,000.

With many loss-stricken farmers defaulting on payments, animal feed distributors too are in trouble, a distributor in Dong Nai said.

Producers blame the price hike on high interest rates and costs, especially of imported additives.

Le Ba Lich, chairman of the Animal Feed Association, said 34 percent of the materials used in animal feed production were imported.

Vietnam's government has waived import tariffs to keep animal feed prices low.

Yet, the efforts have not been enough to tame prices. Analysts said the country must develop local sources for raw materials to avoid price shocks.

US$1 = VND16,255 as of June 4, 2008