Corn imports a threat to domestic producers
Corn imports a threat to domestic producers
A major increase of high-value corn imports to Viet Nam is threatening to seriously undercut domestic production, industry experts have warned.
Mai Van Chung, a purchasing director of the Japfa Cornfeed Viet Nam Ltd Company, said the firm has signed a contract to import 80,000 tonnes of corn for the production of animal feed by March 2014.
Japfa needs at least 16,000 tonnes every month and while it has always imported corn, it is doing so on an unprecedented scale at the present time to take advantage of the cheap price of corn on the South American market.
The cost of imports from nations such as Argentina and Brazil stood at around US$320 per tonne in June but the price has now dropped to $250, he said. Meanwhile, the price of local corn was $295 per tonne.
It is customary for local animal feed producers to purchase all the maize on the Vietnamese market before importing it from abroad when the local supply is exhausted, he said.
This year, though, the import price was cheaper than the local one so they imported the product before the local crop had ended, he added.
As well as being more affordable, foreign corn tends to be of superior quality and has a much lower humidity rate, preserving it for longer.
Domestic disaster
The increase of corn imports has forced the local corn price to fall, said Ha Quyet Nghi, deputy director of the Agriculture and Rural Development Department of northern Son La Province.
In early August, the local maize price was VND7.4 million per tonne. It has now dropped to VND6.2 million, Nghi revealed.
To reduce corn imports, the agricultural sector must apply biotechnology allowing maize production to increase output and better meet the local demand, argued Nguyen Tri Ngoc, former head of the Plantation Department under the Ministry of Agriculture and Rural Development.
Viet Nam does not have enough room to significantly expand maize plantations, so other means of boosting input must be implemented, he said.
The State should support the sector in building corn preservation and distributing systems to ensure a stable supply for the local market, he added.
Le Ba Lich, chairman of the Viet Nam Animal Feed Association, said the country has an annual maize output of 4.5 million tonnes and only 1.8 million tonnes goes to animal feed processors.
The processors currently must import 1-1.8 million tonnes of maize from India, the US, Brazil, Argentina and China to meet their demand.
In the first eight months this year, the nation imported 1.34 million tonnes of maize, 18.9 per cent higher than the same period of last year.
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