August 11, 2008

The Finance Ministry of Vietnam has decided to cut the import tax of some feed ingredients in an aim to ease the situation of high feed grain prices.

Do Hoang Anh Tuan, deputy minister of finance has just signed a decision to reduce the import tax on whey and whey powder from 10 percent to 2 percent, while soy has been reduced from 2 percent to zero.

The decision is seen to solve successive feed price hikes following 20 to 50 percent increases in the in recent past months.

Vietnam is forced to import ingredients for animal feed due to local supply shortage.

The decision also aims to strengthen the development of animal husbandry in the country.

This year, nearly 40 domestic feedstock-production enterprises for cattle, pigs, poultry and even fish have temporarily shut down, according to the Ministry of Agriculture and Rural Development’s Animal Husbandry Department.

Growth in animal husbandry was only a weak 0.03 per cent in the first half of the year, said Hoang Kim Giao, the department's director.

He added that to reach the annual growth of 4 to 5 percent in the second half of the year, the industry must grow by at least 8-10 percent.

Demand for feed ingredients is expected to increase by 8 percent in the next 10 years.

The Ministry of Agriculture and Rural Development has been asking the government to put animal-food products and ingredients on the list of essential commodities and reduce import tax to zero per cent.