Oversupply of pork leading to price cuts
Oversupply of pork leading to price cuts
Many pig farmers are having to sell their pork for less than the price set by the government due to a current oversupply.
Some farms are now selling their pigs for 16,000-17,000 kip per kg while the government has set the sale price at 18,000-22,500 kip per kg, according to the Ministry of Industry and Commerce.
This set price was issued in April last year but the authorities have not updated it, ministry officials told Vientiane Times last week.
The price was set at a time when there was a shortage of pigs, in the interests of protecting consumers.
But there are now large numbers of pigs available for market supply, and prices have fallen to about 16,000-17,000 kip a kg.
Despite this, the ministry believes that pig farmers are still making a profit, saying that no farm operator has sought assistance as yet.
To protect and promote domestic production, the government has banned the import of pork and piglets.
As the price of pigs at the farm gate has decreased, the government hopes the price of pork in the market will also drop.
When there was a shortage of pork last year, the price in Vientiane markets rose to 38,000-40,000 kip per kg but has now dropped to 35,000-36,000 kip per kg, the Domestic Trade Department reported.
The Vientiane Foodstuff State Enterprise is working with CP Lao Co., Ltd. to adjust the price of pork at its slaughterhouse to lower the cost of pork for the benefit of consumers.
The price of mixed pork at the Donedou slaughterhouse in Hadxaifong district has now been reduced from 21,000 kip to 18,500 kip per kg, according to the Director of the enterprise, Mr Khamla Saengdara.
Due to increasing foreign investment in recent years, Vientiane, has experienced considerable growth in the number of pig farming ventures.
Statistics from the department show that 3 million pigs were raised across the country in 2013, with a 6 percent annual growth rate.
The department said these numbers and the growing trend enabled Laos to produce a surplus of pork for export.
However, high interest rates levied by the banks and difficulties accessing funds remain major issues for Lao pig farmers.
Several local operators have gone out of business as their income did not meet the costs incurred, such as interest repayments to banks.
