Pork prices set to rise as year-end supply dwindles

The ministry estimates that pig herd numbers have declined by 10% year on year as of September this year. Pork production in the third quarter was 522,000 tonnes, down 2.3% compared with the previous year.

The situation has resulted out of a long-term plunge in pork prices. The foot-and-mouth disease outbreak in a number of northern provinces was also a reason for many farmers deciding to stop breeding pigs.

According to the MARD’s Department of Livestock Production, pig farmers are also not interested in expanding their pig herds due to unstable pork prices.

The department estimates that the number of pig breeding households is predicted to reduce by a third, or between 800,000 and 900,000 by the end of this year.

After nearly 4,000 pigs were found injected with sedatives at the Xuyen A Slaughter House Complex in HCM City recently, pork prices fell to VND25,000-27,000 (about US$1.1) per kilo in Dong Nai, he said.

A similar situation has happened in pig farming areas in Hanoi, with many households going bankrupt or shifting to other businesses.

Tran Van Minh, a breeder in the capital city’s outlying Dan Phuong district, is among them.

He was among the bigger breeders in the district, but his farm stands empty now. Over the past two years, the household business has operated at a loss as pork prices continued to fall. They even sold valuable property to continue investing in pig farming. Now they are bankrupt and hundreds of millions of đồng in debt, owing money they spent on feed, veterinary medicines and other things.

“We’ve lost everything. We are too old to be employed by companies so we look forward to receiving assistance from the government,” Minh said.

Nguyen Kim Doan, vice chairman of Dong Nai Poultry Association, warned that the high number of households quitting pig breeding would result in rising unemployment in rural areas, with most of the people affected being those too old to work in companies or enterprises, and incapable of doing hard work.

“About 40% of small scale big breeders, amounting to tens of thousands of households, have gone bankrupt. This has created difficulties for local authorities in generating employment and in ensuring social security and order,” Doan told the Nong thon ngay nay (Countryside Today) newspaper.

Nguyen Duc Trong, Deputy Director of Department of Livestock Production, said they haven’t got the exact number of households who’ve quit pig breeding or correct figures from big businesses like the CP (Charoen Pokphand) Group that have large number of sows and pig herds.

He said it was normal that prices go up and down in livestock breeding sector.

For example, pork prices increased constantly from 2011 to early 2016. There was a time it reached VND52,000 (US$2.3) per kilo. The prices started dropping from the end of last year, he said, adding that it has affected a lot of farmers.

"I assume that the pork prices will increase from now until the year-end if the number of pigs herds keeps dropping. However, the increase will not be as steep or sudden as before," said Trong.

Several breeders have turned to exports because of low consumption and prices in the domestic market. Trong said the ministry would try its best to create favourable conditions for exporters.

"At present, we export about 40,000 tonnes of pork per year, via eight enterprises from Hai Duong province and Hai Phong city.”

"The ministry plans to establish disease-free zones to reduce production costs and facilitate pork export to markets like Europe. This is an urgent matter so the ministry is determined to do this,” he said.