Vietnam Animal Feed Market 2016

‹#›

Vietnam Animal Feed Market 2016

Date of the report: August 25th, 2016

Part of StoxPlus’s Market Research Report Series for Vietnamwww.biinform.com

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2

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Date: 25th August, 2016

Dear Our Valued Customer,

Re: The publication of Vietnam Animal Feed Market 2016 Report

I am pleased to pleased to announce the publication of Vietnam

Animal Feed Market 2016 Report.

The purpose of research work is to have an in-depth understanding

of animal feed market in Vietnam and assessing potential of the

market. We also highlighted current market size as well as

potential demand of commercial cold storage for each segment.

We believe it should be further studied and evaluated.

In addition to our experience in this industry, we have conducted

various discussions and interviews with industry players,

distribution partners at executive levels to grasp local insights and

the practical ways of the market in Vietnam.

We understand that this is a targeted but also an open research.

We would be happy to provide any further information to address

any questions that you may have, for any specific sector or target

business in Vietnam. Our ultimate objective is to bring real values

to our clients via in-depth research and practical local insights.

mailto:[email protected]

3

Table of Contents

Part Content Page

Executive Summary 4 - 7

Abbreviation 8

1 Section 1: Agribusiness in Vietnam 9 - 20

1.1 Market structure 9 - 10

1.2 Market size and segmentation 11 - 20

2 Section 2: Animal feed in Vietnam 21 - 83

2.1 Market size and segmentation 21 - 30

2.2 Value chain analysis 31 – 33

2.3 Demand analysis 34 – 39

2.4 Supply analysis 40 – 62

2.5 Costing analysis 63 - 69

2.6 Competition landscape 70 - 83

3 Macroeconomics 84 - 96

3.1 Macroeconomics 84 – 90

3.2 Legal environment 91 - 96

Part Content Page

4 Appendix 97 - 105

4.1Appendix 1: Livestock farming in Vietnam by

provinces, 2014

4.2Appendix 2: Livestock companies by provinces,

2013

4.3Appendix 3: The volume of maize imported by

key players in 2015

4.4Appendix 4: The volume of rice/wheat bran

imported by key players in 2015

4.5Appendix 5: The volume of roasted soybean


4.6

Appendix 6: The volume of protein powder


4.7Appendix 7: The volume of DDGS imported by

key players in 2015

4

Executive Summary

We have completed the review of Vietnam

animal feed industry landscape. Information

covered include market size, competition

dynamics, analysis of potential demand from

end-used markets, profiles of major key players.

One of the focuses of this report is the

emergence of Vietnamese giant companies in

this sector and its sale strategies to getting

more market share from current players in the

market. Ultimately, we assessed the feasibility

of the market potentials as well as notable

common issues that animal feed players and

investors should be aware of when operating in

Vietnam.

Below are the most critical findings:

1) Agriculture, forestry and aquaculture

sector (“agri-sector”) continues to grow,

however the growth rate is in a decreasing

trend in 2015

2015 is a hard year for agri-sector on overall.

2) Vietnam Livestock Market still has a

positive outlook despite the economic

integration causes many fluctuations

Figure: Market size of Vietnam livestock sector,

2011-2015

2011 2012 2013 2014 2015

US$m

n

3)

Vietnam is a agricultural country with 70% of

electors are involved in agriculture sector

including farming, livestock and fishery.

Figure: Estimated consumption of industrial feed

in Vietnam, 2011-2015

2011 2012 2013 2014 2015

Million t

one

This page is intentionally left blank for demo purpose

5

Executive Summary (cont.)

5) Over

6

Figure:

2015

2014

Figure: Animal feed demand from main livestock,

2015-2020

2015 2016 2020

Million t

one


6


8) Typical distribution system of animal

feed in Vietnam

9) 55% of main materials

As the two main ingredients in feed formula,

corn and roasted soybean has the largest

proportion in total import volume of feed’s

raw materials in Vietnam 2015.

10) The price of Vietnam animal feed is

20% higher than other countries in ASEAN

area

11) Many brand name companies in global

animal feed market are already in Vietnam

and dominating the market

.

Figure: Distribution system of animal feed in

Vietnam

Figure: Animal feed price per tone of selected

companies in Vietnam, 2015

US$

Figure: Market share of Vietnam animal feed market,

2013


7


12) New trend in Vietnam animal feed

market .


8

Abbreviation

No. Abbrev. Stand for

1 Agri-sector Agriculture, forestry and aquaculture sector

2 CARG Compound Annual Growth Rate

3 DDGS Distillers dried grais with solubes

4 FCR Feed conversion rate

5 FDI Foreign direct investment

6 FTAs Free Trade Agreements

7 HVG Hung Vuong Corp

8 IPPC International Plant Protection Convention

9 JV Joint Venture

10 L/C Letter of credit

11 MARD Minister of Agriculture and Rural Development

12 OECD Organization for Economic Cooperation and Development

13 OIE World Organisation for Animal Health

14 OLED Organic light-emitting diode

15 R&D Research and Development

16 ROA Return on Asset

17 ROE Return on Equity

18 SPS Sanitary and Phytosanitary

19 TPP Trans-Pacific Partnership Agreement

20 VCCI Vietnam Chamber of Commerce and Industry

9

Section 1: Agribusiness in Vietnam

Contents

1.1 Market structure

1.2 Market size and segmentation

10

Agribusiness is the business of agricultural production. It includes crop production

(farming and contract farming), seed supply, agrichemicals, farm machinery,

distribution, processing, marketing, and retail sales.



Figure 1: Agribusiness market structure in Vietnam

Source: StoxPlus

Agri

cult

ure

Farming

Livestock

Agriservice

Seed

Plantation

Processing

Feeds

Raising

Processing

Agrochemicals

Agriproduct

Retailing

Cattle feeds

Poultry feeds

11


Contents



12

Agriculture, forestry and aquaculture sector (“agri-sector”) continues to grow,

however the growth rate is in a decreasing trend in 2015

Figure 2: Market size of Vietnam agribusiness by value, 2011-2015

Source: StoxPlus


1.2 Market size and segmentation | Total industry

2011 2012 2013 2014 2015

US$m

n


13

Farming is the biggest segment in agriculture sector with total value of

Figure 3: Breakdown of Vietnamese Agriculture Industry by

value, 2011-2015

Source: StoxPlus


1.2 Market size and segmentation | Farming

2011 2012 2013 2014 2015

US$m

n

Figure 4: Market size of Vietnamese farming by value, 2011-2015

Source: StoxPlus


14

The production of meat in Vietnam is behind the demand

Figure 5: Production and consumption of main meat in Vietnam

Source: StoxPlus from OECD, Custom, MARDNotes:


1.2 Market size and segmentation | Livestock


15

Vietnam Livestock Market still has a positive outlook despite the economic integration

causes many fluctuations

Figure 6: Market size of Vietnam livestock sector, 2011-2015

Source: StoxPlus


1.2 Market size and segmentation | Livestock Domestic supply

Million heads of

livestock

Thousand tones

of meat

Pig

Beef and buffalo

Chicken and other poultry

Others


16

Figure 7: Breakdown of livestock company by type of business, 2014


1.2 Market size and segmentation | Livestock

Above 90% of livestock farming in Vietnam is operating at small or very small scale

Domestic supply

Figure xx: Breakdown of pig company by size, 2014

Figure xx: Breakdown of chicken company by size, 2014

Source: StoxPlus from MARD


17

Each year, Vietnam spend more than

Figure 8: Domestic production vs Import of livestock’s products, 2015

Source: StoxPlus

Notes:

Figure 9: The import of meat in Vietnam via official trade in 2015

Source: StoxPlus from MARD


1.2 Market size and segmentation | Livestock Import

'000 t

one


18

Figure 10: Import of livestock’s products by value, 2015


1.2 Market size and segmentation | Livestock Import

Source: StoxPlus from IPSARD, MARD


19

Figure 11: Cost structure of pork production in Vietnam, 2015

Source: StoxPlus

Figure 12: Cost structure of pork production in USA, 2015

Source: StoxPlus


1.2 Market size and segmentation | Livestock Cost structure

Cost to raise one kilogram of pig

Vietnamese livestock farms

Vietnamese livestock household

USA livestock farms

Figure xx: Cost to raise one kilogram of pig, 2015

Source: StoxPlus from IPSARD, MARD

Farm modelHousehold

0%

20%

40%

60%

80%

100%

Vietnamese farm Vietnamese household USA farm

Cost for animal feed Cost for breed Cost for veteriany Labour cost Lending cost Cost of marketing Others


20

Most of Vietnam livestock’s products are consumed via traditional markets

Figure 13: Where’s Vietnamese people buy pork?

Source: StoxPlus from IPSARD


1.2 Market size and segmentation | Livestock Distribution


21

Section 2: Animal feed in Vietnam

Contents


2.2 Value chain analysis

2.3 Demand analysis

2.4 Supply analysis

2.5 Costing analysis

2.6 Competition landscape

22

Historical of Animal feed sector

Proconco was the

first animal feed in

Vietnam, established

in Bien Hoa Dong Nai

CP Group, one of the

largest Asian animal

feed producer,

established of CP

Vietnam Livestock Ltd

Cargill Vietnam , the

subsidiary of leading

agriculture enterprise

and ANT were founded

Anco was established

in Dong Nai province

while Greenfeed

opened in Long An

province

Masan participates in

the market, invest in

52% stock of Proconco

and have 70%

ownership of Anco

EastHope (Chinese

company) established

East Hope company

Ltd

20151991 1993 1995 2003 2010 2013

Vietnam exports 895

tone animal feed, with

amount equivalent to

200mm USD

• Vietnam livestock industry appears and develops spontaneously. For the first stage of its development, farmers

mainly utilize by-products from agriculture to feed their livestock.

• By the early 20th century, the animal feed industry appears and grows rapidly along with the development of science

and technology. In 1991, Vietnamese-French joint venture Proconco , the first animal feed company in Vietnam,

established and built the factory located in Bien Hoa, Dong Nia. Up to 2003, there were 136 factories participating

in this sector with capacity of 3.5mm tones per year.

• Vietnam is listed as one of 20 biggest countries of feed producing. Vietnam started to export animal feed in 2013 and

in the year of 2014, Animal feed was exported to over 10 countries including US, Japan, Malaysia.


2.1 Market size and segmentation |Historical and Development

23


2.1 Market size and segmentation |Market size

Figure 14: Vietnam livestock, 2011-2015

Source: StoxPlus

2011 2012 2013 2014 2015

Figure 15: Estimated consumption of industrial feed in Vietnam, 2011-2015

Source: StoxPlus’s estimation from AgroMonitor

Note:

2011 2012 2013 2014 2015

Million t

one


24


2.1 Market size and segmentation | Segmentation

Figure 16: Domestic consumption of industrial feed by type of

livestock,2015

Source: StoxPlus

Domestic consumption by type of livestock

Livestock Total number (Million heads)

Poultry

Chicken

Duck

Goose

Pig

Beef

Buffalo

Others

Total

Figure xx: Breakdown of livestock in Vietnam by type, 2015

Source: StoxPlus from Department of Livestock production, MARD

This page is intentionally left blank for

demo purpose

25


2.1 Market size and segmentation |Segmentation

Figure 17: Industrial feed and self-made feed consumed by pig, 2015

Source: StoxPlus from AgroMonitor

Pig

Million t

one

Million t

one


demo purpose

26

The situation of poultry industry is same with pig industry…



Figure 18: Industrial feed and self-made feed consumed by poultry, 2015

Poultry


27

The North is


2.1 Market size and segmentation |Segmentation Domestic consumption by Region

Distribution of livestock by regions

The North Buffalo Beef Pig Poultry Others

Red river delta

Northern midland

and mountainous

Source: StoxPlus

The South Buffalo Beef Pig Poultry Others

Southeast

Mekong river delta

The Central Buffalo Beef Pig Poultry Others

North central and

central coast

Central Highlands

This page is intentionally left blank

for demo purpose

28

of animal feed was consumed by provinces in the North in 2015



Figure 19: Vietnam’s livestock by region, 2015

Source: StoxPlus

Figure 20: Animal feed consumption by region, 2015

Source: StoxPlus

Million h

ead

Domestic consumption by Region


demo purpose

29

Pig’s demand for feed is decreasing in the late stage of feeding period while poultry’s

demand is increasing



Figure 21: Pig and Chicken’s life cycle, 2015

Source: StoxPlus

Source: StoxPlus

Domestic consumption by month


30

Vietnam receives over US$ 500mn from exporting animal feed and its materials



Figure 22: Export of Vietnam animal feed and its materials, 2013-2015

Source: StoxPlus

Figure 23: Breakdown of feed and its materials exported by

country, 2014-2015

Source: StoxPlus

Export

By value


31


Contents



2.3 Demand analysis

2.4 Supply analysis



32

Value chain of Vietnam animal feed


2.1 Market size and segmentation |Value chain analysis

Figure 24: Value chain of Vietnam animal feed, 2015

Source: StoxPlus


33


2.1 Market size and segmentation |Value chain analysis

Roles for each participant in the business chain


34


Contents



2.3 Demand analysis

2.4 Supply analysis



35

Demand for poultry feed and cattle will increase in line with the change in livestock’s

structure under the Decision No.10/2008/QD-TTg


2.2 Demand analysis

Figure 25: Structure of Vietnamese meat by volume in 2015

Source: StoxPlus

Figure 26: Planned structure of Vietnamese meat by volume in 2020

Source: StoxPlus

Demand by type of products


36

Despite of the plan in 2008, as an forecast from Department of livestock production in 3/2016, the

livestock structure will not change much in 2016-2020. From this forecast,


2.2 Demand analysis

Figure 27: Vietnam livestock, 2015-2020

Source: StoxPlus from Department of livestock production

Figure 29: Animal feed demand from main livestock, 2015-2020

Source: StoxPlusNote: The estimation is based on the average industrial feed demand per million livestock

Million h

eads

Million h

eads

Million h

eads

LivestockMillion

heads

Million

tone feed

Feed demand per

million livestock

Pig

Poultry

Cattle, buffalo, goats, sheep

Figure 28: Industrial feed demand per million heads, 2015

Source: StoxPlus

Total demand


demo purpose

37

Livestock allocation is planned to change from now to 2020 pushing the change in feed

demand of each area in Vietnam


2.2 Demand analysis

Figure 30: Pig allocation by regions, 2015-2020

Source: StoxPlus from Department of Livestock production

Demand from main livestock by regions


38

Demand for industrial feed will increase due to the change in livestock farming’s

structure under the Decision No.10/2008/QD-TTg


2.2 Demand analysis

Figure 31: Pig farming vs household by pig volume, 2013-2020


Figure 32: Poultry farming vs household by poultry volume, 2013-

2020


Total demand


39

PIG Current structure Million headsTotal demand

for feed

% of industrial

feed in total

demand

Total demand

for industrial

feed

PIG New structure Million headsTotal demand

for feed

% of industrial

feed in total

demand

Total demand

for industrial

feed

Poultry 392.39

POULTRY Current structure Million headsTotal demand

for feed

% of industrial

feed in total

demand

Total demand

for industrial

feed

POULTRY New structure Million headsTotal demand

for feed

% of industrial

feed in total

demand

Total demand

for industrial

feed

Examples about the increase in demand of industrial feed when structure of livestock

farming changing


2.2 Demand analysis

Figure 33: Demand of animal feed per million heads

(thousand tones), 2015

Farm Household

Industrial

feed

Self-made

feed

Industrial

feed

Self-made

feed

Pig

Poultry

Figure 34: Feed structure by livestock farming and

household, 2015

Source: StoxPlus from AgroMonitor

Total demand

Demand of

industrial feed

Demand of Self-

made feed

Total

demand

Assumption Estimation of feed demand in 2020 from pigs and poultry

Source: StoxPlus


40


Contents



2.3 Demand analysis

2.4 Supply analysis



41


2.3 Supply analysis | Finished products

Figure 35: Total supply of animal feed in Vietnam, 2000-2015

Source: StoxPlus from Department of Livestock Production (MARD)

Total supply

Million t

one


42

Pig feed remains its largest proportion in total animal feed in Vietnam



Figure 36: Volume of industrial feed supplied by type of livestock, 2014

Source: StoxPlus

Figure 37: Volume of industrial feed supplied by type of livestock, 2015

Source: StoxPlus

Supply by type of products

2014 2015


43

comes from Red river delta and Southeast area



Figure 38: Production volume of Industrial feed by regions, 2014

Source: StoxPlus

Supply by regions

This page is intentionally left blank for demo

purpose

44



Figure 39: Number of animal feed companies by regions, 2014

Allocation of animal feed companies

Figure 40: Volume of animal feed produced by regions, 2014

Source: StoxPlus Source: StoxPlus

Com

pany Million t

ones


45



Figure 41: Number of animal feed companies in the North

Source: StoxPlus


Animal feed companies in the North

Northern midland and mountainous

Red river delta

• Northern midland and mountainous: Ha Giang, Cao Bang, Lao Cai, Bac

Kan, Lang Son, Quang Ninh, Tuyen Quang, Yen Bai, Thai Nguyen, Vinh Phuc,

Phu Tho, Bac Giang, Bac Ninh, Lai Chau, Đien Bien, Son La, Hoa Binh

• Red river delta: Bac Ninh, Ha Nam, Ha Nội, Hai Duong, Hai Phong, Hung

Yen, Nam Dinh, Ninh Binh, Thai Binh and Vinh Phuc


for demo purpose

46



Figure 42: Number of animal feed companies in the Central

Source: StoxPlus


North Central Coast

Hoang Sa

• North Central Coast: Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri, Thua Thien-Hue; Da Nang, Quang Nam,

Quang Ngai, Binh Dinh, Phu Yen, Khanh Hoa, Ninh Thuan and Binh Thuan

• Central Highlands: Kon Tum, Gia Lai, Dak Lak, Dak Nong and Lam Dong


47



Figure 43: Number of animal feed companies in the South

Source: StoxPlus


Southeast

Truong Sa

Mekong river delta

• Southeast: Ho Chi Minh, Ba Ria-Vung Tau, Binh Duong, Binh Phuoc, Dong Nai,

Tay Ninh

• Mekong river delta: Long An, Tien Giang, Ben Tre, Vinh Long, Tra Vinh, Hau

Giang, Soc Trang, Dong Tháp, An Giang, Kiên Giang, Bac Lieu and Ca Mau.


48



Figure 44: Distribution system of animal feed in Vietnam

Source: StoxPlus

Distribution

Typical distribution system of animal feed in Vietnam

Level 1 Agency

Payment condition and commission


49


2.3 Supply analysis | Raw materials

Source: StoxPlus Source: StoxPlus

Basic formula of feed supplied


50



Figure 47: Feed’s raw materials imported vs local production, 2015

Source: StoxPlus

Figure 48x: Supply of main raw materials for producing animal feed, 2015

Source: StoxPlus


51



Figure 49: Imported volume by type of products, 2015

Source: StoxPlus

Figure 50: Imported raw materials by countries, 2015

Source: StoxPlus


52



Figure 51: Corn by source of providing, 2015

Corn

Import


53



Figure 52: Top 10 importers of corn in the North, 2015

Corn

Source: StoxPlus

Figure 53: Top 10 importers of corn in the South, 2015

Source: StoxPlus

Thousand tones

54

Local production accounted for 87% total supply of rice and wheat bran in 2015



Figure 54: Rice and wheat bran by source of providing, 2015

Rice/wheat bran

Bran

Wheat bran

Rice bran

Figure xx: by region, 2015

Source: StoxPlus


55

Top 10 importers of rice bran in two main areas of Vietnam



Figure 55: Top 10 importers of rice bran in the North, 2015 Figure 56: Top 10 importers of rice bran in the South, 2015

Source: StoxPlus

Rice bran

63


56

Top 10 importers of wheat bran in two main areas of Vietnam



Figure 57: Top 10 importers of wheat bran in the North, 2015

Source: StoxPlus

Figure 58: Top 10 importers of wheat bran in the South, 2015

Source: StoxPlus

Wheat bran

of Vietnam by trading companies.


57



Figure 59: Roasted soybean by source of providing, 2015

Roasted soybeans

Roasted

Soybean

Why is Argentina?


58



Figure 60: Top 10 importers of Roasted soybean in the North, 2015

Source: StoxPlus

Figure 61: Top 10 importers of Roasted soybean in the South, 2015

Source: StoxPlus

Roasted soybeans

Only 30%


59

100% DDGS using in feed industry is imported from others countries



Figure 62: DDGS imported by countries, 2015

DDGS

Figure 63: Top 10 DDGS importers in the North, 2015

Source: StoxPlus

Figure 64: Top 10 DDGS importers in the North, 2015 DDGS


60

Majority of cassava used for producing feed is supplied by domestic sources.



Figure 65: Cassava by source of providing, 2015

Cassava

Cassava


61

70% protein powder using in Vietnam is imported



Figure 66: Protein powder by source of providing, 2015

Protein powder

Vietnam could produce approx.

of

Meat &

Bone

Fish

Protein

powder

An Giang


62

Top 10 importers of protein powder in two main areas of Vietnam



Figure 67: Top 10 importers of protein powder in the North, 2015

Source: StoxPlus

Figure 68: Top 10 importers of protein powder in the South, 2015

Source: StoxPlus

Protein powder


63


Contents



2.3 Demand analysis

2.4 Supply analysis



64

The price of Vietnam animal feed is 20% higher than other countries in ASEAN area


2.4 Costing analysis | Pricing

Figure 70: Animal feed price per tone of selected companies in Vietnam,

2015

Source: StoxPlus

US$


65

Feed price and cost structure of C.P Vietnam


2.4 Costing analysis | Cost structure

Figure 71: Price per tone of animal feed produced by C.P Vietnam, 2013-

2015

Source: StoxPlus

Figure 72: Cost structure of C.P Vietnam, 2014

Source: StoxPlus

Note:


66

Feed price and cost structure of Greenfeed



Figure 73: Price per tone of animal feed produced by Greenfeed, 2013-2015

Source: StoxPlus

Figure 74: Cost structure of Greenfeed, 2014

Source: StoxPlus

Note:


67

Feed price and cost structure of Cargill



Figure 75: Price per tone of animal feed produced by Cargill Vietnam, 2013-

2015

Source: StoxPlus

Figure 76: Cost structure of Cargill Vietnam, 2014

Source: StoxPlus

Note: Raw


68

Feed price and cost structure of Dabaco



Figure 77: Price per tone of animal feed produced by Dabaco, 2015

Source: StoxPlus

Figure 78: Cost structure of Dabaco, 2015

Source: StoxPlus

Note: Raw


69

Feed price and cost structure of Proconco



Figure 79: Cost structure of Proconco, 2014

Source: StoxPlus

Note: Raw


70


Contents



2.3 Demand analysis

2.4 Supply analysis



71

Many brand name companies in global animal feed market are already in Vietnam and

dominating the market



Figure 80: Market share of Vietnam animal feed market, 2013

Source: StoxPlus from Vietnam Animal Feed Association

Animal feed

Foreign-dominated market

Rise of local companies ?

How could top 10 dominate the market?


72

Figure 81: Number of animal feed companies by type of company, 2015 Figure 82: Volume of animal feed supplied by type of company, 2015

Source: StoxPlus from Department of Livestock Production



Source: StoxPlus from Department of Livestock Production

Foreign companies


73

Foreign players are expanding and expanding their business in Vietnam

Source: StoxPlus

Figure 83: New investments from foreign companies in animal feed


2.5 Competition landscape Foreign companies

No Owner Type of

investment

Location Year in

Operation

Capacity Total

area

(m2)

Total

Investment

(US$)

Main content of project

1

2

3

4

5

6

74

Figure 84: Number of animal feed companies in Vietnam, 2013-2015

Source: StoxPlus



Source: StoxPlus

Figure 85: Number of local animal feed companies by regions, 2013-2015

Local companies


75

If Masan joins the market via M&A, Hung Vuong and Hoa Phat decide to make a new

investment in this sector

Source: StoxPlus

Figure 86: New investments from local companies in animal feed


2.5 Competition landscape Local companies

No Owner Type of

investment

Location Year in

Operation

Capacity Total area

(m2)

Total

Investment

(US$)

Main content of project

1

2

3

4

5

76




77




78



Who is Hoa Phat?

What do they do to meet their target in animal feed?

Core business

Expand

Plan


79



Main products, Target market and Distribution systemCompany Profile

CP Vietnam

Source: Reported Financial Statements

Financial Indicators

Source: StoxPlus


80




Proconco


Financial Indicators ROA & ROE IN 2012, 2013 & 2014

Source: StoxPlus


81




Cargill Vietnam




82




Greenfeed Vietnam




83




DABACO GROUP


Financial Indicators ROA & ROE IN 2012 - 2015

Source: StoxPlus


84

Section 3: Macroeconomics

Contents

3.1 Macroeconomics

3.2 Legal environment

85

Section 3: Macroeconomics & Regulatory Framework

Macroeconomics

Vietnamese economy to slow down after a strong year

Figure 87: Vietnam’s GDP growth (q-o-q) and CPI over the last 11 year

Source: StoxPlus, GSO

GDP Growth 1H2016

CPI 1H2016

Well performed

Struggled

Restructured & recovered


86


Macroeconomics

Figure 88: GDP Growth by sector 2015 (%)

Source: StoxPlus, GSO


87


Macroeconomics

Figure 89: Exchange rate fluctuation 2010 - 2015

Source: StoxPlus from VCB

Exchange Rate (VND/USD)


88

No. Country No. of projects US$mn

1 South Korea

2 Japan

3 Singapore

4 Taiwan

5 Hong Kong

6 China

7 British Virgin Islands

8 Malaysia

9 Cayman Islands

10 Other

TOTAL


Macroeconomics

Foreign direct investment (“FDI”) to climb up in 1H2016

Figure 90: Vietnam’s GDP growth (q-o-q) and CPI over the last 11 year

Source: StoxPlus, MPI

Registered 1H2016

Disbursed 1H2016

Figure xx: Registered FDI into Vietnam, 1H2016



89


3.2 Legal environment/ TPP

Contents Main content Challenges & Real Implications

National

Treatment

and Market

Access for

Goods

Sanitary and

Phytosanitar

y (SPS)

Measures

Technical

Barriers to

Trade

Investment

TPP request Vietnam animal feed sector to enhance to competitiveness via increase supply ability

and set the standards on quality and technical management to meet international requirement


90


3.2 Legal environment/ Management and Technical Standard

Countries Applicable

Year

Agreement

Korean

Asean, Japan, Australia,

New Zealand, Indian

Japan

USA and 11 other countries

Taxation on Maize and soya-bean oil

Tax rate

of Maize

Tax rate

of soya-

bean oil

Effective date

Favour

ASEAN (ATIGA)

ASEAN -China (ACFTA)

ASEAN - Korea (AKFTA)

ASEAN - Australia - New

Zealand (AANZFTA)

ASEAN - India (AIFTA)

Figure 91: The import tax of Maize (corn) starchFigure 90: The schedule to reduce Tax to 0%

The schedule to reduce Tax following TPP and FTAs




91


Contents

3.1 Macroeconomics


92



Some main contents of regulations on Animal feed managements

Item Term RegulationEffective

yearMain Contents

Management Management of

animal feed25/03/2010

Technical

Standard

National

Technical

standard in

animal feed

sector

12/03/2012

93



Before Circular 50After Circular 50

Animal feed


94



The legal framework for foreign companies to invest in Vietnamese market

Note for investorsLicensing process for manufacturing and trading animal feed


95

Animal feed product not subject to VAT, reducing burden and cost for players


3.2 Legal environment/ Taxation

Advantages Disadvantages


96


3.2 Legal environment/ Taxation

Government increases the imported tax for animal feed, causing higher cost for

material


97

Section 4: Appendix

Contents

4.1 Livestock farming by provinces

4.2 Animal feed companies by provinces

4.3 Maize imported by key players

4.4 Rice & wheat bran imported by key players

4.5 Roasted soybean imported by key players

4.6 Protein powder imported by key players

4.7 DDGS imported by key players

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Livestock farming in Vietnam by provinces, 2014

Section 4: Appendix

4.1 Livestock farming

No Province/City No. of Farms No Province/City No. of Farms No Province/City No. of Farms

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

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Livestock companies by provinces, 2013

No. Province/City Capacity(MT/Year) No. of

manufacturers

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

No. Province/City Capacity(MT/Year)No. of

manufacturers

19

20

21

22

23

24

25

26

27

28

29

30

31

32

33

34

35

36

Section 4: Appendix

4.2 Animal feed companies by regions

100

The volume of maize imported by key players in 2015

Section 4: Appendix

4.3 Maize imported by key players

No Company Type of company % volume imported

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29

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The volume of rice bran imported by key players in 2015

Section 4: Appendix


No Company Type of company% volume

importedNo Company Type of company

% volume of

imported

1 1

2 2

3 3

4 4

5 5

6 6

7 7

8 8

9 9

10 10

11 11

12 12

13 13

14 14

15 15

16 16

17 17

18 18

19 19

20 20

21 21

The North The South

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The volume of wheat bran imported by key players in 2015

Section 4: Appendix


No CompanyType of

company

% volume

importedNo Company

Type of

company

% volume

imported

1 1

2 2

3 3

4 4

5 5

6 6

7 7

8 8

9 9

10 10

11 11

12 12

13 13

14 14

15 15

16 16

17 17

18 18

19 19

20 20

21 21

The North The South

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The volume of roasted soybean imported by key players in 2015

Section 4: Appendix

4.5 Roasted soybean imported by key players

The North The South



% volume

imported

1 1

2 2

3 3

4 4

5 5

6 6

7 7

8 8

9 9

10 10

11 11

12 12

13 13

14 14

15 15

16 16

17 17

18 18

19 19

20 20

21 21

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The volume of protein powder imported by key players in 2015

Section 4: Appendix

4.6 Protein powder imported by key players

The North The South

No CompanyType of

company

% volume

importedNo Company

Type of

company

% volume

imported

1 1

2 2

3 3

4 4

5 5

6 6

7 7

8 8

9 9

10 10

11 11

12 12

13 13

14 14

15 15

16 16

17 17

18 18

19 19

20 20

21 21

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The volume of DDGS imported by key players in 2015

Section 4: Appendix

4.7 DDGS imported by key players

The North The South



% volume

imported

1 1

2 2

3 3

4 4

5 5

6 6

7 7

8 8

9 9

10 10

11 11

12 12

13 13

14 14

15 15

16 16

17 17

18 18

19 19

20 20

21 21

106


Publishing License No. 1528-2016/CXBIPH/76-29/HD dated on May 20th, 2015

‹#›

Contact us at StoxPlus

Hoang Le

Manager, Biinform

+84 (0) 43562 69 62 (ext. 108)

+84 (0) 98 515 2028

[email protected]

Head Office

5th Floor, Anh Minh Building

36 Hoang Cau Street

Hanoi, Vietnam

+ 84 (4) 3562 6962

Ho Chi Minh City Branch

2nd Floor, 63D Vo Van Tan

Ward 06, District 03

Ho Chi Minh City, Vietnam

+84 (8) 3823 3485

Lan Nguyen

Managing Director, Biinform

+84 (0) 43562 69 62 (ext. 109)

+84 (0) 964 946 760

[email protected]

Anh Nguyen

Associate, Biinform

+84 (0) 43562 69 62 (ext. 108)

+84 (0) 1228 377 555

[email protected]

Vietnam Animal Feed Market 2016

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