October 28, 2024

 

Vietnam's livestock and aquaculture growth drives higher demand for feed, increased imports

 
 

 

Vietnam's livestock and aquaculture sectors are experiencing continued growth due to an improving economy and rising exports, leading to an increased demand for feed and higher imports of feed ingredients, World Grain reported.

 

This information comes from a quarterly update issued by the Foreign Agricultural Service (FAS) of the US Department of Agriculture (USDA).

 

In its report, the FAS estimated that total feed demand in Vietnam will reach 26.83 million tonnes in 2023-24, driven by a gradual rebound in the demand for animal and aquafeed. The forecast for 2024-25 has been revised upwards to 27.85 million tonnes as Vietnam's economy strengthens, and the husbandry and fishery sectors continue to expand.

 

Lower global prices for corn and wheat have encouraged Vietnamese importers to seek more cost-effective sources of feed ingredients. Total imports of feed ingredients are projected to rise to 20.99 million tonnes in 2024, up from 20 million tonnes in 2023.

 

Corn imports are expected to increase to 8.48 million tonnes in 2024, up from 7.87 million tonnes the previous year. Distiller's dried grains with solubles (DDGS) imports are forecast at 1.09 million tonnes in 2024, a slight increase from 1.05 million tonnes in 2023. However, imports of feed wheat are predicted to decline slightly to 2.35 million tonnes from 2.45 million tonnes.

 

Argentina and Brazil are the largest suppliers of corn to Vietnam, accounting for 74% and 23% of the total import volume, respectively.

 

The report also highlighted changes in the market for US DDGS. While US DDGS still dominate the Vietnam market, the US market share dropped to 65% in the first eight months of 2024, down from 75% in the same period in 2023. Brazil is the second largest supplier, holding 17% of the market.

 

The demand for feed corn in Vietnam is forecast to rise to 13 million tonnes in 2024-25, up from 12 million tonnes in 2023-24. However, domestic corn production for 2024-25 is expected to be at 3.9 million tonnes. The local corn production and cultivated area have been declining annually since 2013.

 

"Corn is less economically viable than other crops in Vietnam, but it can be grown as a substitute rotational crop in rice fields," the FAS report stated. The report also noted that corn stalks can be used as cattle feed, providing an additional source of income for corn farmers.

 

Vietnam relies entirely on imports for its wheat supply. The report indicated that wheat purchases in 2023-24 reached 5.4 million tonnes, a 32% increase compared to 2022-23. Australia, Brazil, and Ukraine were identified as the main suppliers of wheat to Vietnam, with Australia accounting for 32%, Brazil 21%, and Ukraine 20% of imports.

 

Although Australian wheat imports declined by 43%, imports from Brazil, Ukraine, and Russia surged by fourfold, sixfold, and 3.5 times, respectively, compared to 2022-23.

 

The FAS also noted a significant shift in Vietnam's wheat imports, with feed wheat import volume increasing by 94% as wheat prices converged with corn prices. "This is the first time since 2018-19 that feed wheat imports exceeded imports of milling wheat," the report said.

 

-      World Grain