Profits still out of reach for pig farming companies

Feb 2nd at 08:14
02-02-2024 08:14:13+07:00

Profits still out of reach for pig farming companies

Despite the total herd increasing to a new high, 2023 has been called a poor year for the pig farming industry, with businesses and farmers failing to make a profit.

At a 2023 summary conference by the Ministry of Agriculture and Rural Development (MARD) in early January, leaders said that the pig farming industry was likely to have incurred losses over the past year, greatly affecting the profit plans of each enterprise and the entire industry.

The results of listed husbandry businesses in the first nine months of 2023 just released echo the results. In the first three quarters of 2023, the after-tax profits of Dabaco Group were $780,000, equalling only 3 per cent of the yearly plan.

Vissan JSC earned $5 million in pre-tax profit as of end-October, equalling 66 per cent of the yearly plan. The company has adjusted its plan 24 per cent lower compared to last year.

Hoang Anh Gia Lai JSC estimated profit for the whole year of 2023 to be $90.7 million, nearly double its projection, but most of this comes from liquidation and asset transfer activities.

Elsewhere, BaF Vietnam Agriculture JSC reported only $2.2 million in after-tax profit, equivalent to 17.6 per cent of the annual target.

BaF aims to expand the size of the pig herd to 800,000 by the end of this year and double the net profit compared to 2023. VNDirect Securities forecasts that BaF Vietnam’s revenue may increase by 7.4 per cent in 2024, enabling net profit to increase by an estimated 15.9 per cent compared to 2023.

Last week, BaF Vietnam acquired pig farming company Thanh Dat Gia Lai CNC in Gia Lai province. Last year, it invested in seven new farms in Tay Ninh province. In 2024, it plans to put two new farms into operation in the next month or so.

Meanwhile, Do Xuan Huy, vice president of C.P. Vietnam, said that the selling prices of live hogs in 2023 were low, on average $2.06 per kg.

“Both livestock households and major businesses are suffering losses in pig farming,” Huy said. “The price of live pigs was lower than in 2022, mainly because of weak consumption, increased domestic meat supply, and African swine fever issues.”

Local meat has had to compete with smuggled pigs from neighbouring countries with lower prices, despite the risk of disease infection and food insecurity (see above).

Since June 2023, there have been six reductions in animal feed prices in the country, but they are still around 45 per cent higher than before the coronavirus pandemic.

Tong Xuan Chinh, deputy director of the MARD’s Department of Livestock, said that the selling price of live hogs was lower than the production cost.

“The cost of breeding livestock is about $2.30-2.50 per kg. With the selling prices in 2023, farmers cannot earn any profit,” Chinh said.

In 2023, the country’s total pig herd was estimated to reach 30.3 million, an increase of 4.2 per cent compared to 2022; live pork output reached 4.68 million tons.

VNDirect said that the Vietnamese pork market still had growth potential and businesses covering the feed-farm-food model would benefit from the trend of clean meat in urban areas.

Some businesses expressed optimism about 2024. Dabaco has set a revenue target of $1.1 billion and after-tax profit of $30.8 million, an increase of 3 and 28 per cent compared to the 2023 plan.

Hoang Anh Gia Lai also expects that 2024 profits will be about 25 per cent higher than last year’s results.

vir



RELATED STOCK CODE (1)

NEWS SAME CATEGORY

Hanoi plans over 60 trade promotion events this year

This year's trade promotion activities will be based on the principle of diversification and flexibility to expand into new export markets and make effective use of...

Vietnam’s manufacturing sector sees encouraging start to 2024

Manufacturers in Vietnam returned to growth at the start of 2024 as tentative signs of improving demand fed through to renewed increases in new orders and output.

92.9% of tourism businesses expect growth in revenue in 2024

Việt Nam's tourism industry stands at the threshold of a remarkable milestone, with experts asserting that an impressive figure of 14-15 million foreign visitors...

Việt Nam’s export revenue up 4.1% in first half of January

Việt Nam had shipped US$15.08 billion worth of products overseas as of January 15, a year-on-year increase of 4.1 per cent, the General Statistics Office has...

AeonMall Vietnam to develop shopping centre in Đà Nẵng

The Saigon Thương Tín Real Estate Joint Stock Company (TTC Land) and AeonMall Vietnam Co., Ltd has officially announced a plan to construct an Aeon Mall shopping...

AEON Vietnam strives to meet increasing demand of customers during Tết

AEON Vietnam is gearing up for the Lunar New Year with a wide range of products, increased inventory, price stabilisation and many attractive promotions to meet the...

Non-tariff barriers raise issues for improving competitiveness, compliance

The recent move by the European Union to increase official controls on several farm products from Việt Nam has notified producers and exporters of the importance of...

Việt Nam trade offices will take new opportunities to achieve sustainable export

Việt Nam trade offices abroad need to provide information about market trends in countries and export opportunities to Việt Nam's localities, associations and...

​Samsung joins hands with Vietnamese tech university to boost semiconductor training

The VNU-Hanoi University of Engineering and Technology signed a deal on Wednesday morning with Samsung Electronics to initiate a semiconductor training program in...

​Korean firm begins work on $20mn Boeing 787, 737 Max aircraft component plant in Vietnam

South Korean aero parts supplier KP Aero Industries broke ground on its KP Vina Aircraft Component factory project, worth US$20 million in investment, in Da Nang...


MOST READ


Back To Top