Vietnamese market sees oversupply of Australian cattle

Vietnam imported 311,523 head from Australia in 2015 and more than 20,000 so far this year. The figures have caused domestic sale prices for feedlotters to fall significantly.

A Vietnamese feedlot operator who has imported Australian cattle for the last three years said his home market is over-supplied.

Vo Xuan Hoa, operating director of Ket Phat Thinh (KPT) - one of Vietnam's largest cattle importers that began operations in 2012 – noted local business is hurt by the large number of cattle in the supply chain, which surpasses domestic demand. He said the number should be between 200,000-250,000 head this year.

In 2014, the volume of exported cattle to Vietnam began to soar, with Australian producers targeting the market for heavier stock.

Hoa said his company had so far imported nearly 300,000 head.

Feeding the stock had become vital to return a profit, as import prices have risen to AUD3 per kilogramme compared to around AUD2.1 at the beginning of the company’s operations, Hoa added.

He noted that KPT could make some profit by importing cattle to then sell to abattoirs, but this is impossible now.

Under standards set by Australian exporters, CCTV cameras have been installed in all facilities handling Australian stock.

Hoa claimed the roll-out of the system in his company was smooth, but stressed its costly maintenance.