Ministry calls for dairy industry to up competitiveness

The competitiveness of Viet Nam’s milk products remains weak because of dependence on imported materials and lack of high-tech equipment in the industry, officials have said.

Phan Chi Dung, director of the Ministry of Industry and Trade’s Light Industry Department, said yesterday only 24 per cent of demand for locally produced materials was met during the 2006-10 period. The target was 40 per cent.

By 2025, locally produced materials are expected to be sufficient for liquid milk and yoghurt processing demand.

However, currently, raw materials for powdered milk continue to be imported.

The dairy industry has also faced other difficulties, including inconsistent milk quality and nontransparent pricing.

“State agencies did not closely monitor milk pricing and they lacked links with customs, tax departments and market management departments who participate in price supervision and inspection,” he said.

In the past, high inflation and high-interest loans and exchange-rate fluctuations have also created problems for the industry.

The economic downturn and the melamine scandal led to lower sales.

Currently, the scale of husbandry remains small, with 95 per cent of the number of milch cows raised in small households and small-scale farms.

The country still imports 80 per cent of feed for its milch cow husbandry.

High feed costs and low milk capacity of cows has led to inefficient operations, with many farmers shifting to another job.

Dung said total investment capital for dairy industry development by 2015 would be VND4.132 trillion ($206.6 million); VND5.228 trillion ($261.4 million) for 2016-20; and VND6.067 trillion ($303.3 million) for 2021-25.

In the near future, the industry should focus on developing specialised areas for cow husbandry, he said.

“The dairy businesses need to pay attention to foodstuff safety and hygiene and environmental protection as well as create sustainable development,” he said.

The use of advanced technology and machinery would also help boost productivity and efficiency.

The industry should focus on building a strong national brandname to increase international competitiveness.

New policies on import taxes, land regulations for milch cow husbandry, and technical assistance should be developed, Dung said.

In January next year, regulations on quality and production standards on dairy products will come into effect.

It will set a standard on content and additives, which will be used during inspections.

There are 72 dairy businesses operating in the domestic market, an increase of 59 per cent compared to 2000.

For the past few years, the dairy industry provided jobs for more than 9,300 workers at an average income of VND7.2 million ($360) per month.

Do Kim Tuyen, a specialist at the Animal Husbandry Department, said the milk output was expected to reach 319,919 tonnes this year, an increase of 15 per cent.

It will increase to more than 1 million tonnes by 2020.

The milk output aims to meet 35-38 per cent of domestic demand, he said.

However, lack of knowledge on veterinary and reproduction has led to low productivity and low-quality milk.

Trinh Quy Pho, general secretary of the Viet Nam Milk Association, said inconsistent quality made it difficult for processors. Local farmers were not familiar with milk quality management.

In addition, the information exchange between milk processors, scientists, policy-makers and farmers was also poor, he said.

Pho said the association would support its members in seeking international-standard advanced technology in increasing productivity and product quality. They will also seek partners for raw material export and import.— VNS

Tags: Vietnam Dairy sector