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Soaring Vietnamese Milk Prices Leave Many Behind

30 June 2009

VIET NAM - The price of milk in Viet Nam continues to soar. Now, many are unable to afford it alotgether.

In 1995, the average consumption per person was 3.7kg per year. This rose to 6kg in 2000 and 12.3kg in 2007, and is estimated to reach 20kg by 2020.

Domestic supplies are only able to meet about 28 per cent of demand. Importers of milk products have responded by hiking milk prices multiple times since 2007, with prices for various products rising by 7-25 per cent during a period when the cost of milk on world markets was falling sharply.

The website www.dairyvietnam.org.vn has reported that, by the end of 2008, the cost of milk powder on world market had dropped to US$2,000 per tonne.

"The price of imported milk in Viet Nam is now higher than in other regional countries," Ho Tat Thang, vice chairman of the Viet Nam Standards and Consumers Association (VINASTAS), said at a conference in May. "It is three times higher than that in Thailand and twice as high as in Malaysia."

The prices seem all the more unreasonable in light of the fact that the Government has reduced import taxes on milk by 50 per cent.

"I don’t understand why consumers in a developing country like Viet Nam have to pay such a high price for milk," Nhung said. "Milk importers do not care about the lives or circumstances of their consumers."

VINASTAS confirmed that milk importers spent $30 million on advertising last year but said it was unreasonable for all of these costs to be passed on to consumers.

Consumer attitudes were also a problem, admitted Thang, with many Vietnamese consumers driving up the price of imported milk by believing it is better than the domestic product. They are willing to pay more for imports.

TheCattleSite News Desk



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