Submit News Stories or Press Releases

Small scale Vietnamese feed manufacturers struggle against foreign firms

Published on 1 April, 2013, Last updated at 15:53 GMT
Small scale Vietnamese feed manufacturers struggle against foreign firms

Small scale Vietnamese feed manufacturers are finding it increasingly difficult to compete in a market which has seen the growth and expansion of several large foriegn feed firms in the country.

Last year, 40 out of the 243 Vietnamese feed manufacturers were forced to close their doors, and the number of local manufacturers ceasing operations is expected to continue, commented chairman of the Vietnam Feed Association (VFA), Le Ba Lich.

Lich said, it was expected that approximately 70 other small businesses were on the verge of closing down and forfeiting their market share to the foreign manufacturers.

Many of the small scale feed producers that had capacities of less than 10,000 tons a year have had to either shut down or reduce production due to fierce competition in Vietnam's feed industry. A large number of these companies were located in Dong Nai or Binh Duong, the region considered the southern hubs of the animal feed making industry in Vietnam.

Most of the feed making plants with an annual capacity of at least 50,000 tons belong to foreign companies, the VFA said. Most of the foreign invested firms had large plans to expand their operations in Vietnam also, with CP Vietnam, New Hope, and Cargill all planning to open more feed plants. CP has stated that by 2014, it would build six more cattle-feed plants in Vietnam. Similarly, New Hope also plan to build around 5-6 more feed plants in the coming years.

Lich continued stating that it was impossible for local producers to compete with foreign cattle-feed companies, because of worse interest rates and higher taxes.

Local producers were force to pay around 15% per annum interest rates on any loans, while foreign firms were able to get loans at interest rates at low as 3-5% per annum or lower. Local poroducers also had to pay VAT and land rental where foreign producers didn't providing them with an unfair advantage..

"(Local Vietnamese) firms should upgrade their facilities and coordinate with each other to strengthen their power." said Lich, explaining what local feed producers should be doing to remain competitive in this market.

Not all Vietnamese feed manufacturers are however performing poorly though, with Vina Cam Company and Hong Ha Company notablystanding out, with outstanding potential and the ability to take on foreign producers.

The Vietnamese production accounts for 40% of the total feed produced in the country, with the remaining 60% being produced by the foreign invested firms. 80% of the manufactured feeds in Vietnam is for pigs, 18% for poultry and remaining 2% is for cattle.


Players in the Vietnamese feed manufacturing industry:

Foreign invested feed manufacturers

Cargill (US): first invested in Vietnam back in 1995, They currently operate 7 feed mills producing approximately 750,000 tonnes of feed per annum.

Charoen Pokphand CP (Thailand): first invested in Vietnam back in 1993 and currently operate around 10 factories in Vietnam. CP Vietnam is engaged in providing seeds, feed, aqua-farming, breeds of pigs, chicken, equipment for livestock and aqua-farming, and food processing.

Anova (EWOS Norway): entered the Vietnamese market in 2010, producing aquafeed for fish.

De Heus: their first feed mill was started in Dong Nai province, in 2008. De Heus now has 3 feed mills in the country, 1 producing livestock feed and 1 producing fish feed.

Uni-President Enterprise (Taiwanese backed): opened its third feed plant in 2011, they have a total feed manufacturing capacity of 258000 tonnes of animal feed per annum.

Kyodo Sojitz: became the first Japanese cattle-feed mill owner in the country with the recent opening of thier USD$24 million, 200,000 tonnes per annum feed mill


Important Vietnamese feed producers

VIC company – Golden Pig Ltd: established in 1999 and located in Hai Phong province, the company
has 4 manufacturing factories throughout the country.

Dabaco: established in 2004, has two feed mills in Bac Ninh province, with a total production capacity of 290,000 tonnes per annum.

Quang Dung Company: established in 1999 in Ho Chi Minh City, Quang Dung specialises in
feed related logistics and distribution. The company is a local partner of Bunge Agri Business.

Quang Minh Corporation: established in 2002 in Hanoi, has grown to operate 4 manufacturing factories in 4 different northern provinces of the country.

VietThang feed joint Stock Company: established in 2002 in Dong Thap, the company has 7 factories in the South of Vietnam with a total production capacity of 290,000 tonnes per annum.

Vasafeed Joint Stock Company: established in 1985 in Ho Chi Minh City.

Vietland Joint Stock Company: established since 2008 in Bac Giang province, the company currently has a production capacity of 70,000 tonnes of feed per annum.

Hong Ha Nutrition Joint Stock Co: became the largest feed manufacturer in Viet Nam with the opening of its new feed mill factory in Ha Nam Province in 2012.


opens in a new window or tab
  • 2024 © All Rights Reserved.