Supply cannot meet demand, pork prices increase and stay high, helping the ‘big guys’ in the livestock industry make a fortune. Some businesses have profits dozens of times higher than the same period last year.
Mr. Nguyen Cong Bac – Director of Loc Phat BLLT Livestock Company (Son La) – said that recently, there were times when the price of live pigs jumped to 70 000 VND/kg, helping the company earn a profit of about 1.8 million VND/pig when selling. On that occasion, he sold about 1 000 pigs.
In recent days, live pigs have dropped to 63 000 – 65 000 VND/kg. With this price, the company’s pig farms still achieved a profit of 18-20%.
According to Mr. Bac, from the beginning of the year until now, pig farming has been “easier” than in 2023. The first quarter of this year had a slight profit, and the second quarter saw higher profits due to the increase in pig prices.
“Pork is in a state of not meeting demand in supply. Wherever the farms have pigs for sale, the dealers will catch them all.” Mr. Bac said that the price of animal feed has also cooled down, so the company’s farms are raising at maximum capacity from 10 000-11 000 pigs and 1 500 sows.
Pork prices have increased sharply recently. Photo: Nhat Sinh
According to the Ministry of Agriculture and Rural Development, in the second quarter of 2024, the pig herd in our country tends to increase again due to the strong shift of household farming to semi-industrial farming, linking with businesses. However, African swine fever is still complicated in many localities, causing the livestock farming situation to be unstable, especially in the household sector.
Pork prices tend to increase sharply, then cool down but remain at a high level. In July 2024, the price of live pigs nationwide fluctuated from 62 000 – 66 000 VND/kg. This price helps farmers and businesses earn quite high profits.
In fact, in the first 6 months of this year, most pig farming enterprises recorded good growth thanks to high and stable pork prices for a long time.
For example, in the first 6 months of 2024, Hoa Phat Livestock Development Joint Stock Company sold nearly 190 000 pigs for meat, 80 000 commercial pigs and more than 1 000 gilts. Sales of all pig lines grew well. As a result, Hoa Phat’s revenue from livestock farming increased by 34.4% over the same period last year.
BAF Vietnam Agricultural Joint Stock Company also reported revenue from livestock farming activities in the first half of this year reaching VND 1 330 billion, an increase of 2.6 times over the same period last year. In the first 6 months of the year, BAF recorded a profit after tax of nearly VND 154 billion, 12 times higher than the same period last year (nearly VND 12.8 billion).
According to BAF, this is thanks to the recovery of pork prices in the second quarter of this year after hitting rock bottom in the fourth quarter of last year. In addition, BAF’s pig output in the second quarter reached more than 144 000 heads, bringing the total herd in the first half of 2024 to 252 000 heads, 1.8 times higher than the same period last year. The decrease in input material prices also helps businesses increase livestock farming efficiency.
At Dabaco Vietnam Group Joint Stock Company (Dabaco) – a “giant” in the livestock industry, in the first 6 months of 2024, net revenue increased by nearly 11.3% over the same period, to VND 6 437 billion. Profit after tax increased from VND 6 billion in the same period to more than VND 218 billion, equivalent to an increase of more than 36 times.
Previously, at the 2024 annual shareholders’ meeting, Mr. Nguyen Nhu So – Chairman of the Board of Directors of Dabaco, was confident that the company’s profits would increase sharply thanks to rising pork prices along with the herd productivity currently at its highest level in history.
According to him, the production cost is only at VND 48 000 – 51 000/kg, the planned construction price is “cautiously” at VND 52 000/kg, while the price of live pigs is recovering positively and may increase higher. Supply is currently falling more sharply than demand and it will take at least 18 months to overcome the shortage.
Regarding pork supply, Mr. Tong Xuan Chinh – Deputy Director of the Department of Livestock Production (Ministry of Agriculture and Rural Development) – said that from now until the end of the year – including during Tet when pork demand increases by about 10-15%, we will still ensure a good supply from domestic pork production. However, it is necessary to prevent African swine fever and raise pigs in a biosafety manner.
“We have recommended that 16 large pig farming enterprises nationwide expand their production scale to ensure supply,” he emphasized. As for pig farming households, when raising or increasing their herds, they must ensure safe, disease-free and quality breeds, and strictly ensure biosafety to maintain the pig herd.
The Ministry of Agriculture and Rural Development forecasts that the supply of pigs will increase again in the coming time. However, due to the complicated epidemic situation, the price of live pigs may remain high and only decrease again in 2025.
Tam An
Source: Vietnamnet