s1.2 national review of the feed sector in vietnam xavierbocquillet18.03.2014 (1)
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animal feedTRANSCRIPT
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National Review of the feed sector in
Vietnam
Xavier Bocquillet
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Agriculture in Vietnam
Vietnam Production
Rice: 42 million tons (1st exporter in 2013)
Fish: 4.3 million tons
Meat: 3.1 million tons pig meat (No1 in Asean)
0.6 million tons poultry (chicken and duck)
0.3 million tons beef and buffalo
350 million litters milk
Livestock Industry
27.1 million pigs
5.4 million beef & 2.7 million buffalo
1.3 million sheep and goat
226 million chicken & 97 million ducks
Vietnam
Exports : 18.2 billion usd (20% of
VN exports)
Imports : 9 billion usd
Balance : + 9.2 billon usd
France
Exports : 47 billion usd
Imports : 39.4 billion usd
Balance: + 7.6 billion usd
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Agriculture is a highly priority sector for
Vietnamese Government
70% of electors are involved in agriculture
sector
Agriculture ensure
settlement of population in
rural area
Agriculture represent
19% of GDP
19% of National budget
dedicated to agriculture
Agri export = 19 billion usd
Agri Import = 9 billion
usd
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Vietnamese are meat lovers!
0
100
200
300
400
500
600
700
800
900
1000
2010 2011f 2012f 2013f 2014f 2015f
'000 t
on
s
Production and consumption of
poultry in Vietnam
0
100
200
300
400
500
600
700
800
900
2010 2011f 2012f 2013f 2014f 2015f'0
00 t
on
s
Production and consumption of
beef and veal in Vietnam
For pork meat, production cover almost the demand.
in 2015 : production 2,168,000 tons VS consumption 2,213,000 tons
Source: USDA, BMI, 201340kg meat per year per hab
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The feed industry in the world
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2 000
4 000
6 000
8 000
10 000
12 000
14 000
-
50
100
150
200
250
300
350
400
Asia Europe North
America
Latin AmericaMiddle East &
Africa
Others
Nu
mb
er
of
feed
mills
Millio
ns
Source: Alltech, Global Feed Summary, 2013
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Annual animal feed production per country
-
50
100
150
200
250
Millio
ns
Source: Alltech, Global Feed Summary, 2013
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Animal feed industry in Vietnam
3 940 000 5 118 000
6 125 000
7 567 000 8 852 000
10 600 000 11 500 000
12 700 000 13 500 000
18 000 000
25 000 000
-
5 000 000
10 000 000
15 000 000
20 000 000
25 000 000
30 000 000
2005 2006 2007 2008 2009 2010 2011 2012 2013 (f) 2015 (f) 2020 (f)
TO
NS
Source: MARD 2013
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Vietnam Feed industry in figures
In 2013
230 feed mill companies in operation in Vietnam
60 foreign owned companies
44 companies are100% Foreign owned
These 60 controls 60% of market share (against 40% in 2011)
13.5 million tons produced in 2013 (5.7 million in North, 7.8 million in South)
Annual average growth of 17% in the last 5 years
Production Capacity utilization: approx 66%
Ratio of industrial and self-made feed and
import feed during the 2010's
SupplyVS demand of industrial feed
during 2010's in million tons
Source: Adapted
from MARD
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Import of raw materials
-
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
4 500
2005 2006 2007 2008 2009 2010 2011 2012 2013
US
DM
illio
ns
Vietnam's import of feed and feed ingredient
Source: GSO
For 2013, Vietnam had imported 5.84 million tones of animal feed and
ingredients, representing 48% of the raw material needed to satisfy the demand
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Focus on Corn and soya in 2013
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1
2
3
4
5
6
7
8
Corn Soya
Millio
ns
ton
s
Import
Production
Source: MARD & USDA
2.26
4.9
1.40.263
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Presentation of main actors
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Market Shares in 2012
CP Vietnam, 18.80%
Proconco; 10,80%
Cargill VN; 6,70%
East Hope VN; 5,10%
ANT; 4,70%
Japfa Comfeed
VN; 4,50%Greenfeed; 4,40%
Vina; 3,30%Lai Thieu; 2,80%
Anco; 2,20%
Others; 36,70%
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Case Study: CP
Established in 1993 in Vietnam
5 animal feed plants + 3 aqua feed mills
Total capacity of 3.8 million tons per year
2.3 million tons livestock feed
1.5 million tons aquafeed
19% market share
Over 1300 distributors
Integrated company
22% of white feather chicken market (4.5 million
chicken)
7% of pig market (250,000 sows)
16% of egg market ( 3.8 million hens)
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CP Integration
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Marketing system of feed companies
Historical reasons for
distributors
Distribution is done at
several levels.
Feed mills often work
with distributors that can
be exclusive
Level 1 and Level 2
Margin for distributors
around 10 to 15%
FEEDMILL
FARMERS
DISTRIBUTORS
LEVEL 1
DISTRIBUTORS
LEVEL 2
10 to 20%
60 to 70%
10 to 30%
Pig: A dealer industry, feed sold through distributors
But more and more feeder are take back control
Credit is more and more common.
Chicken: A captive market controlled by integrated companies.
CP, Japfa, Emivest control over 60% of the market
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Contract farming system
Today more and more animals are produced under
contract farming system in Vietnam
CP, Japfa, Emivest are historical players.
CP have over 2,000 farms under contract farming
(shrimp, fish, livestock)
Technical support + inputs (DOC/piglet + feed + vet)
Get back the finish product with agreed price calculation
Trends : buying the farm to have better control
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Sustainability of the animal feed industry
Foreign owned companies are taking lead of the feed
business
Investment, R&D and field presence
Financial capacity, contract farming and long term strategy
Integration of value chain: control of input & output
Finally they are in position to control price of meat !
What would be the future of the industry ?
How Vietnamese companies would be able to fill the gap?
What role should have government of Vietnam?
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Thanks for your attention