Overdependence on raw materials for animal feed production from abroad causes many risks to the domestic livestock industry.

Talking with Ho Chi Minh City Law, Mr. Tong Xuan Chinh, Deputy Director of the Department of Livestock Production (Agriculture and Rural Development), said that in the context of the COVID-19 pandemic, animal feed production enterprises (AFEs) all have to make provision for raw materials for production, but the provision can only last for 1-2 months.

Reporter: Sir, what is the current price of animal feed? What is the forecast for the future?

+ Mr. Tong Xuan Chinh: The price of animal feed ingredients in the first six months of this year increased quite strongly compared with the same period last year. For example, the price of corn increased from over 5,639 VND/kg to over 7,616 VND/kg, an increase of about 35%. The price of complete mixed feed also increased from 12.1% to 14.6%. For example, mixed feed for colored-feathered broilers increased from 9,500 VND to nearly 10,900 VND/kg.

Eat the world's ingredients

Regarding the Vietnamese animal feed industry, I have said many times that this is a genuine processing industry and consumes raw materials from the world. At the end of June, although poultry prices increased, many farmers still did not dare to restock, and large farms reduced their scale because feed prices continued to increase.

However, in June and early July, the prices of some key raw materials for animal feed production decreased compared to before. It is expected that the prices of animal feed raw materials will gradually decrease and stabilize in July.

What is the reason for the increase in animal feed prices, sir?

+ The main reason is that the prices of all grains on the world market are increasing. Furthermore, the impact of the COVID-19 epidemic has caused transportation costs to increase by 200%-300% due to the lack of ships and cargo containers in general.

On the other hand, Argentina, a country that supplies large quantities of corn, soybeans, and soybean meal to the world market, had protests and strikes at seaports in January and February. This hindered the export of shipments that had been signed with customers, including many Vietnamese enterprises...

Vietnam is an agricultural country, in which the livestock industry plays an important role. Why do we still have to import most of the raw materials to produce animal feed from the world every year, sir?

+ That's right. Animal feed has several main ingredients, such as the energy group with cereal grains; in Vietnam there is only rice bran; the rest, corn flour, oil cake, soybeans, etc., must be imported.

In 2020, our country imported nearly 10 million tons of corn, mainly for the production of animal feed and aquatic feed. Imported corn has high capacity, good quality, and uniformity. Our corn is mainly grown for human consumption, biomass corn for livestock, and a small amount of corn for household farming, not as a commodity, so we have to depend on imports. The same goes for soybeans; we have 200 hectares, just enough to supply people, so we also have to import.

Protein was previously used a lot from seafood and fish flour, but now we use less fish flour, and mainly protein is used from soybean oil or cereal after ethanol extraction by machine. Those technologies have not been invested heavily by domestic enterprises, so we still have to import...

Many people are concerned that the production of animal feed heavily depends on imported raw materials, which will put the livestock industry in a passive situation. For example, if the COVID-19 pandemic becomes severe and leads to a disruption in the supply chain, what should we do, sir?

+ Currently, large enterprises have to stockpile raw materials for animal feed production, but the stockpile can only last for 1-2 months. If the supply chain is disrupted for a long time, problems will likely arise.

In the worst case, we are forced to quickly change our food ration to quickly switch to using domestic cereals such as rice and bran. But this amount of cereals can only last for a short time because those foods only produce energy, but the protein content is very low, so we still have to supplement. Or use some materials available in Vietnam, such as beer lees, wine lees, seafood, etc., but they can only last for a short time.

Livestock farmers face many difficulties because of high feed prices.

Want to transfer but can't transfer yet

That is really worrying because, with the current situation, the import price of raw animal feed is high, leading to the high cost of animal feed when produced, causing many difficulties for farmers.

+ The Ministry of Agriculture and Rural Development has a policy to quickly transfer ineffective agricultural land to grow crops as raw materials for animal feed production. Currently, 250,000 hectares have been converted; another 250,000 hectares will be converted in the near future, and by 2030, it is expected that 1 million hectares will be transferred.

In addition, we develop plants as raw materials for animal feed production, such as growing genetically modified corn for high productivity because native corn has very low productivity; growing soybeans; and growing biomass corn to feed cattle and buffaloes to reduce the market share of pork and poultry because the proportion of these two types of meat currently accounts for over 90%.

Why is the conversion of ineffective agricultural land to growing crops as raw materials for animal feed production so slow, sir?

+ The reason why it took many years to transfer 250,000 hectares of ineffective agricultural land to grow crops for animal feed production is because priority must be given to maintaining 3.45 million hectares of rice-growing agricultural land to ensure food security. Therefore, many localities want to transfer but have not been able to do so; they can only do so gradually.

Thus, we can only reduce the dependency on imported raw materials by replacing some with domestic production, but we cannot fully replace it.

Thank you, sir.

Importing too much is not sustainable

Currently, about 60% of Vietnam's animal feed production materials depend on imports. Last year, Vietnam spent about 6 billion USD to import over 20 million tons of animal feed materials. Meanwhile, animal feed accounts for 60%-70% of production costs. Therefore, over-dependence on the world market puts the already precarious livestock industry at even greater risk.

At a meeting with associations held by the Ministry of Agriculture and Rural Development, Deputy Minister Nguyen Hoang Hiep expressed sympathy for livestock farmers regarding the rising feed prices recently.

Deputy Minister Hiep said the Ministry of Agriculture and Rural Development is advising the Prime Minister on developing strategies for the agricultural sector. In this strategy, animal feed will be a very important branch. "The Ministry of Agriculture and Rural Development's viewpoint is to take the initiative in feed sources, so that we can ensure costs; importing too much like this is not sustainable," Deputy Minister Hiep said.

According to 24h.com.vn