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Director of the Livestock Market Opportunities Theme at ILRI, Dr Steve Staal, interviewed by Agriculture and Rural Development television channel VTC16
 Agricultural economist and director of the Livestock Market Opportunities Theme at the International Livestock Research Institute (ILRI), Dr Steve Staal, was interviewed on the Weekend Agro-Products Market programme on VTC-16, Vietnam’s agriculture and rural development television channel. 

Dr Staal was speaking during a workshop for an ILRI-led project aimed at improving the competitiveness of smallholder pig producers in an adjusting Vietnam market. The workshop was held on 5 October 2010 at the Melia Hotel, Hanoi, Vietnam to mark the end of the project and to present research findings to stakeholders. 

In this video, he highlights the key findings of the project, noting that smallholder pig producers in Vietnam are indeed competitive and are likely to remain so, especially in light of projected future increases in consumer demand for fresh pork. (From time 15:18).

The three year project (2007-2010) was sponsored by the Australian Centre for International Agricultural Research (ACIAR). The project collaborators were the Centre for Agricultural Policy - Institute of Policy and Strategy for Agricultural and Rural Development (CAP-IPSARD), the International Food Policy Research Institute (IFPRI), Oxfam Hong Kong and the University of Queensland.

Translation of the program is given below:

TV program: Weekend agro-product markets

Channel: VTC 16 – Channel for agriculture and rural development

MC: Dear audience. I am happy to meet you again in the “Weekend agro-product markets” on the agriculture and rural development channel – VTC 16.  Recent increase in feed price and the complex developments of the ‘blue ear’ disease, even in areas which have been considered the nation’s ‘citadel’ of livestock production, have continuously pushed pig price down.  Nevertheless, according to FAOSTAT statistics, pig would still take a dominant portion of total livestock products in Vietnam. Pork demand has been increasing and consumers are more demanding with respect to the quality of pork. On the other hand, household-based pig production supplies at least 80% of total pork consumed in Vietnam.  How to enhance the competitiveness of smallholder producers in an adjusting Vietnam market is the main content of this week’s “Weekend agro-product markets” on VTC 16. But first of all, please brief some updated news.

Narration: A good news for coffee farmers in Lam Dong province: although the world market for Arabica coffee is in downtrend, in the last several days, price of Arabica coffee in Lam Dong has been increasing. The present price is 8,200 VND/kg of fresh coffee, an increase of 2,000 VND compared with the average price in 2009. This allows coffee producers to gain from 100 – 120 million VND per hectare. Presently, retailing prices of several types of fertilizers have increased from 5000 – 50,000 VND per bag of 50kg. World prices of fertilizers such as urea and DAP have increased by 20 – 30 USD/tone. However, due to stagnated domestic demand and strong domestic supply, fertilizer prices have increased but still not matched that of the world.

Narration: The weather is favorable this year so paddy rice is less vulnerable to diseases. Rice productivity is quite high. As flood comes late and is small, farmers do not have to rush for harvest to avoid flood. Presently, price of ordinary rice grain is from 5200-5400 VND/kg, long-grain rice is above 5500 VND/kg, almost double the prices at the summer-fall harvest season. This is the highest price since the beginning of the year 2010. According to rice traders, rice price might still rise but not much and will depend on government policy on price stabilization.

Narration: More than 1 billion USD out of the increase in export turnover of agricultural products is due to the rise in prices of export items such as rubber, cashew, pepper and cassava. Export of some products such as cassava and pepper even drops in quantity but thank to high export prices, export turnover still increases. For example, turnover of pepper increases 71 mil USD, cassava and by-products 166 mil USD, compared to that of the same period in 2009. Export prices of most Vietnam’s agricultural products depend on the movements of world prices. Due to the rise in export price, price of input lobster rises to 185000 VND/kg in September. Prices of other shrimps also increase by, on average, from 5000-7000 VND/kg. On the contrary, under the pressure of the imposition of anti-dumping tax by the US, price of catfish has fallen from the middle of second quarter to the end of third quarter. The price of catfish in An Giang province is now from 15-16000 VND/kg.

Narration: Price of pigs from farms in the Southeast appears to rise in the early of October. Live weight price for pigs from large farm rises to 30-31000 VND/kg. That from household farms also increases to 27-29000 VND/kg. The increase in domestic pig price has reduced the number of pigs exported to China to some few hundreds. Presently, pig price at Mong Cai border gate is around 35 -36000 VND/kg.

FOCUS (Tieu diem)

According to the Ministry of Commerce and Industry, the last 3 months are the high period of sale and consumption thank to construction and wedding seasons, Christmas, export and production seasons and the 2011 New year festival. Regarding livestock production, the volume of pig production in September is nearly 4 million tones, a 3.5% increase by that of last year.  Despite the contagion of diseases in 32 provinces, pig production and consumption would increase substantially in the next 3 months. However, supply and demand would still be in balance due to high volume of inventory and the high level of feed import in the last 9 months. If imported meat floods domestic markets in the last 3 months of the year, domestic livestock production would be in difficulty. According to a report by AgroMonitor, the market for pork would be excited again in the period. Whereas the decrease in prices of food items in the second quarter contributed to the control of CPI, the increase of pork price in the last quarter will probably be a factor leading to the increase of CPI. Increasing tariff on imported meat or using technical barriers by applying some standards or imposing anti-dumping tax are ultimately temporary and emergency measures. The basic issue is to increase quantity and quality of pork from domestic producers, ensuring supply for consumers and raise income for producers.

MC: Dear audience, supplying high quality pork at good price is not easy for smallholder pig keepers but it is what they want to do. However, high feed price, widespread diseases and the lack of investment capital for infrastructure and good input breeds make smallholders difficult to compete. Particularly, they now have to compete with imported products. Please see the following reportage from an area nearby Hanoi, where there are many smallholder pig producers.

Narration: These pig pens have been empty for the last half of year. One of the partitions is used for raising chicken. This is the choice of some farmers in Van Giang town, Hung Yen province in response to the outbreak of ‘blue ear’ disease and increasing feed price.

Mr. Nguyen Huu Bo, a farmer in Van Giang town: My family has 7 partitions for pigs. But now feed price is high, price of piglet is high; disease is there so I stop raising pigs. I use the pig pen for raising chicken.

Narration: For other farmers, though not stop pig production, they have to reduce herd size or to continue pig production in order to maintain the integration of crop-fish-livestock model. However, their earnings have fallen sharply compared to previous years.

Mr. Nguyen Van Noi, a farmer in Van Giang town: In the years of 2007-2008, I could earn 700-800 thousands VND per head. But since 2009, I could get only 200 thousands VND per head. Price of feed is too high.

Narration: Feed price has increased continuously from the beginning of the year. Smallholder producers are the ones that suffer the most since they have to purchase feed through higher level of intermediary. Moreover, feed purchase on one-month credit costs 20-25 thousands VND more per bag. This is the rule of many feed retailers. This makes smallholders disadvantageous. 

Owner of Anh Truc feed retailer: It (feed price) increases without prior advice from the feed company. I just observe the increase in the invoice and so I raise feed price to pig farmers.

Narration: The reason for raising feed price is as usual: higher material prices lead to higher feed price. Feed materials are almost imported so that material cost is high, pushing for high output price. Farmers are the one who suffer the most.

Mr. Nguyen Huu Bo, a farmer in Van Giang town: Pig price has dropped from 31000/kg to 27000/kg. Feed price has increased from about 200,000 to 235,000 per bag. So I temporarily stop raising pigs. But as I has built the pig pen, I want to raise pig otherwise my investment would go to waste.

Mr. Nguyen Van Noi, a farmer in Van Giang town: If feed price is high like this and I could not bear, then I would have to shift to another job. However, I have not yet known what to do.

Narration: The paradox is that Vietnam is an agricultural country but has to import in large volume feed materials such as soybean and corn. This not only makes pig farmers vulnerable to the fluctuations of world markets but also waste local lands. This is the reason that makes feed price in Vietnam higher than that in other countries in the region. Smallholder pig producers like Mr. Noi, Mr. Bo and others would not feel comfortable to expand their production in the context of rising feed price.

FOCUS (Tieu diem)

Narration: Every day, consumers in Hanoi purchase 400 tones of livestock products. Most of the products come from small slaughterhouses that do not meet hygiene standards. Pork is an important type of meat. With the widespread contagion of ‘blue ear’ disease, many consumers are concerned about their health and select pork sold in supermarkets despite its higher price.

Ms. Nguyen Thi Mai, a consumer: I find it more relieved buying (pork) in supermarkets. The reason for buying (pork) in traditional markets is for convenience. Moreover, in supermarkets there are more types of pork to choose.

Narration: The Big C supermarket network has been active in strengthening control over pork purchased, from visual check to requiring all documents relating to hygiene and food safety, and they only gets pork from prestigious suppliers. Thus, Big C has attracted many consumers.

Mr. Nguyen Thai Dzung, Deputy General Director of Big C: Big C has built strict procedure in selecting farms, slaughterhouses and suppliers. We control the process from raising pigs to slaughtering, with supervision of veterinary officers until receiving pork at Big C. Therefore, we can guarantee quality of all products, particularly pork.

Narration: However, according to the latest study by IPSARD, the majority of consumers still want to purchase pork from traditional markets.

A consumer: its (pork) price fits budget of the low income. (I) don’t know it is expensive or not but pork here (traditional market) is fresh, soft and resilient so that I likes it. There (supermarkets), pork is frozen so I don’t like.

In the past, retailers in traditional markets used to avoid quarantine and surveillance. But now, to attract consumers, retailers are active in checking the source of pork from slaughterhouses and cooperate with veterinary officers to check and stamp the pork they sell.

A pork retailer at Ngo Si Lien market: (pork) is checked carefully. It is checked at slaughterhouse and is check again here (market). We have the pork checked twice. We have to sell fresh pork otherwise consumers will go away. Consumers are now very demanding. They only purchase if they find (the cut of pork) flexible and resilient. Pork here is fresher than that in supermarkets. Here, they can purchase small volume, but at supermarkets, they have to purchase larger volume. Moreover, in supermarkets, pork is frozen so consumers do not like (it).

Narration: Pork in supermarkets is frozen or chilled so many consumers dislike. Moreover, traditional markets often locate near residential areas, more convenient and have lower price, meeting the requirements of the majority of consumers.  IPSARD has cooperated with ILRI to implement a project to enhance competitiveness of smallholder pig producers in an adjusting Vietnam market. The project aims to increase pig production, support smallholder producers and sale of pork through traditional markets.

MC: Dear audience. Smallholders will continue to face difficulties as above if they could not access to higher-value chains, including niche markets. In the context of increasing demand for pork with specific attributes and the broader context of adjusting livestock industry, the solution is to identify technological, institutional and policy options to allow smallholders to raise income. To this end, IPSARD in collaboration with ILRI has conducted a project to enhance smallholders’ competitiveness in an adjusting Vietnam market.

Narration: This is a workshop under the project “Enhance the competitiveness of pig producers in an adjusting Vietnam market”.  The purpose is to identify technologies, policies and institutional forms to allow smallholders to enhance their competitiveness in the context of increasing demand for pork.

STEVE interview (this section is not noted down here)

Narration: The workshop also presents scenarios of future pig sector in the next 10 year. It is projected that fresh pork consumption would increase 6% per year or 80% in 10 years. Volume of processed and frozen pork would increase by 12%/year or triple in 10 years. Export of pork would diminish gradually in the next 10 years due to increased domestic demand.

Dr. Nguyen Do Anh Tuan, IPSARD: The “Livestock Development Strategy to 2010” is directed towards large commercial farms that can meet hygiene standards and environment requirements. However, the fact is that 90% of pig producers in Vietnam are smallholders. Thus, the first thing to do to support them is to avoid issuing biased policies in favor of large farms, in terms of infrastructure support (roads, electricity, water, etc) in livestock zones or financial support (credit and tax). Without government support, smallholders can still compete since consumers’ preferences are in favor of smallholders’ production: they prefer fresh pork, lean pork and local bred pigs. For smallholders’ competition in the context of globalization, the core solution is to improve technologies in two aspects: breeds and feeds. For breeds, it is necessary to focus on research and technology transfer, especially for cross-breeds between local and exotic breeds so as to have breeds of good quality and productivity. For feeds, we need to develop feed technologies that utilize agricultural by-products. These ensure competitiveness of smallholder pig production.

Narration: The project has surveys in several provinces across the country: Hanoi, Phu Tho, Nghe An, Daklak, Dong Nai and Tien Giang. Subsequent activity following the project would be pilot programs in some provinces.

MC: Dear audience. There are many factors that can enhance competitiveness of smallholder pig producers such as low input cost, good breeds, and modern production technologies. But hygiene and food safety should be put as priority. If pig producers are supported with infrastructure and capital to apply modern technologies to reduce pollution and produce safe pork at low price and at the same time, market this safe product, making a close cycle that ensure hygiene and food safety from farm to fork, their products can have competitive edge over other meat.

Narration: These pigs are raised in a ‘safe’ production farm; applying “Con Heo Vang” (golden pig) procedure of VIC feed company. Due to the high and safe quality of the pigs, thousands of pigs raised in this technology have been selected by Minh Hien company (a slaughter company) as their exclusive source of pig supply for Hanoian in the event of Hanoi 1000 year anniversary.

Mr. Dinh Xuan Him, Binh Da commune, Thanh Oai district, Hanoi: The pork from these pigs is good, different from local pigs. Local pigs are fatty and consumers dislike fat. Previously, consumers could not distinguish between the pigs, but now, demand for these pigs are huge.

Mr. Dinh Ngoc Duy, Minh Hien company: From color to quality, the pork meets all requirements from supermarkets.

Naration: Also in this period of time, along with the price discount in “price stabilization program” ordered by Hanoi people committee, Minh Hien company and VIC feed company has collaborated to launch a promotion campaign, discounting 10% of pork retail price.

Mr. Nguyen Quang Thao, Binh Da commune, Thanh Oai district, Hanoi: consumers like this pork. They dislike other pork that is fatty.

Narration: To ensure large and stable volume of pork to meet consumer demand, recently, Minh Hien company and VIC company, the owner of Con Heo Vang brand name, have cooperated to build a close cycle from feed supplier to pig producers to slaughter and processor. The goal is to supply high quality and safe pork to consumers.

Mr. Cao Duy Nam, deputy director of VIC company: Our goal is to take care of consumers’ health and to ensure that all consumers can enjoy our safe pork and are aware of our “golden meat” brand name. To this end, we have collaborated with Minh Hien company, a slaughterhouse operator, to combine safe pig production with safe pig slaughter to supply to supermarkets and other shops in the city (Hanoi).

Narration: The technology of Con Heo Vang has been transferred from USA for 10 years. Pigs raised with this technology have good smell of pork, high lean content, low feed cost while ensure healthy pig herd and low pollution. This technology has received good comments from veterinary officers in the last several years.

Mr. Nguyen Thanh Tung, sub-Department of Animal Health, Hanoi: We appreciate the procedure of centralized production to avoid disease. Moreover, there is surveillance from farm to slaughterhouse so that the pork meets standards and consumers can feel safe with this pork.

Narration: As the pork is of higher quality at the same price with pork from other sources, the sale of the pigs are stable, supplying to supermarkets and high-quality outlets. While ‘blue ear’ disease has frequently threatened marketing of pigs, the cooperation of pig farmers, feed suppliers and pork processors would be the solution.

MC: Dear audience. Presently, the obstacle that hinders imported meat to crowd over is consumers’ preferences for fresh pork. Frozen pork also requires cooling equipment. Thus, imported pork can only access to supermarkets in big cities and to hotels and restaurants. However, we should not be presumptuous. Enhancing competitiveness of pig raising households should be put as priority in order to allow domestic production to gain markets and to raise pig producers’ income. Our program will stop here. We hope to see you in the program next week, on VTC 16.

 

 
  Small pig producers bring home the bacon
  Improving small pig keepers’ competitiveness in Vietnam: A policy dialogue in Nghe An province
  Concern of smallholder pig producers in Nghe An
  Smallholder pig producers in Nghe An: Viability, Current Constraints and Solutions
  Vietnam: taking a pig to market

  More

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