Vietnam’s chicken imports surge, prices tumble

(VOV) -Imports of frozen bone-in pork and chicken parts have jumped in the early months of 2015 and are expected to grow by leaps and bounds in coming years, according to the Ministry of Agriculture and Rural Development (MARD).

Up to 2,432 MT of chicken and 68,100 MT of pork cutlets have entered Vietnam in the six month period leading up to July, a year-on-year respective spike of 47.0% and 54.5% in imports, official statistics of the Livestock Department attached to MARD show.

Vietnam – a target market

Overall meat shipments saw their strongest upswing after the ministry in mid-May issued certificates to 106 companies permitting them to import a variety of red and white meats including beef, pork and poultry, a MARD spokesperson announced.

The Vietnam Trade Promotion Agency (Vietrade) in turn reported that EU companies have set their sights on the Vietnam market with about 100 meat exporters from the EU having been recently issued quarantine certificates by veterinary authorities.

vietnam’s chicken imports surge, prices tumble  hinh 0

A Vietrade official said over the past three years, the volume of frozen pork imported from the EU has escalated seven and a half fold to 6,100 MT, while beef has leapt six fold to 1,000 MT.

The Vietnam Economic Times recently quoted a Vietrade official as saying imports from the EU market are expected to swell even further following the signing of a free trade agreement between Vietnam and the EU later this year.

The trade agreement with the EU in the offing provides for a concurrent lapse in import duties, setting the stage for further boosts to meat imports driven by lower costs to the nation’s importers.

Price – an important element to boost imports

Doan Xuan Truc, vice chairman of the Vietnam Poultry Association said the rise of pork and chicken imports – particularly over the past month – has put tremendous downward pressure on prices to the detriment of the country’s farmers.

The price of imported frozen chicken wings and legs have been hovering around VND21,000, which is approximately equal to one US dollar per kilogram and half the cost of comparable parts produced by Vietnamese farmers.

However, Truc cautioned that the quality of some imported chicken is highly suspect and often at the packaging expiration date due to the lengthy transit time it takes to ship meat from foreign markets and manoeuvre through administrative hurdles.

It can take up to a year to get from the slaughterhouse in a foreign country and to the supermarket shelves in Vietnam— and one always has to be cognizant of the risk of repackaging to disguise the true expiration date, Truc underscored.

Truc added that the price of foreign meat and poultry is oftentimes less expensive than its domestic counterpart because many cuts that are considered by-products overseas are considered specialties in Vietnam.

During a recent conference, MARD Minister Cao Duc Phat expressed his concern about trade liberalization between Vietnam and foreign countries specifically as it relates to the importation of beef, pork and poultry.

Phat suggested the most important thing for the country’s smallholders and small family farms to achieve prosperity is to push quality up, costs down and form cooperatives or producer associations to provide the link to the global supply chain.

The pursuit of export-led growth strategies in Vietnam has yet to bring them into the global value chains and until that happen small farmers are going to face substantial difficulties and hardship.

Phat also suggested that MARD should consider putting technical barriers in place to control the volume and quality of meat imports to make sure the health of consumers is adequately protected.