This article will give an overview to Vietnam dariy market in 2022.
Author: Gavin Loo
- Vietnam Economy at a Glance
- Dairy Product Consumption and Production
- Dairy Import
- Major Local Players
Vietnam Economy at a Glance
Located in the heart of Southeast Asia, Vietnam borders Cambodia and Laos to the east and China to the North. The country has 3,300 KM coastline, and located in the most prosperous shipping route between EU / Mid-East and China/Japan. As of Dec2020, Vietnam’s population reached 97.34million, and is the third most populous country in ASEAN and 15th in the world.
Over past 30 years from the launch of Doi Moi reforms, Vietnam witnessed a major development success story. Its per capita GDP growth since 1990 has been among the fastest in the world. As at Dec2020, GDP and GDP per Capita stood at USD271b and USD2,656 respectively.
With a solid vision for the future, Vietnam has created a concrete foundation to bounce back stronger in 2022. The government targets GDP growth of 6-6.5 percent, while the World Bank has forecast Vietnam’s GDP to rebound to 5.5 percent provided the pandemic is brought under control both at home and abroad.
Dairy Product Consumption and Production
Vietnam has low consumption dairy products. However, the demand for drinking milk and dairy products is increasing in the country. In 2020, Vietnam’s milk consumption was 1.76 million tonnes of milk and dairy products ?8.6% yoy?, with per capita milk consumption at 26-27 kg per year (22kg in 2019), in contrast to Thailand (35kg), Singapore (50kg) and most EU countries (over 100kg).
However the demand for milk and dairy products has strong momentum thanks to the young population, increased income, and acceptance of better nutrition sources. Expected total milk consumption will rise from USD1.76b in 2015 to USD3.48b in 2022 with CAGR of 14% per statista.
Vietnam dairy farms produced 1 billion liters of fresh milk in 2020, accounting for 38% of domestic demand. And the industry targets to increase in the next five years to 1.5 billion liters. Per Vietnam Ministry of Agriculture and Rural Development, the cow herd in Vietnam is growing strongly as increased investments in expanding production. The dairy cattle herd is expected to increase from 500,000 in 2020 to 700,000 cows by 2030.
Vietnam Dairy and Milk Product Import
Total dairy product import turnover is estimated at USD837m in 2020, and was forecasted to surpass US$ 1 billion in 2023. Main export countries include Newzealand, the U.S,
It is notable that Vietnam unilaterally lowering tariffs on key dairy products and ingredients, including skim milk powder, whole milk powder, cheese, milk albumin and protein isolate. Most tariffs on dairy products and ingredients will decrease by 50%, the decree goes into effect on July 10, 2020.
This decree will better position the N.Z. and U.S. dairy industry, currently Vietnam is the 8th biggest export market of US dairy industry. We expect the import will keep momentum as Vienam’s on-going demand for consistent supply of high-quality and competitively priced dairy products.
Major Local Players in Vietnam Dairy Market
Vinamilk: Formed in 1976 and 36% state-owned, Vinamilk is the market leader in Vietnam local dairy industry. Now it occupies over 40% of market share. In 2020, it has 120,000 dairy cows and expected to further grow to 200,000 heads in 2022. Besides local market, it also proactively tapped into Combodia and U.S. Markets.
Source: YYK Barn Research Team
TH Group: It is the parent group of TH Milk, TH Group is the second largest manufacturer of dairy products. It also produce food and beverage. Now TH Group has 45,000 livestock heads and target to expand the herd to 200,000 in 2025. The distribution of the TH milk products is operated by TH food chain JSC. Beside local market, TH Group also go into Russia and China market. In Russia Kaluga region, TH Group has set up a dairy complex with total investment of USD633m, it is the biggest Vienamese investment in Russian agriculture. It is also the first company that export dairy to China.
Any question about the Vietnam Dairy Market Overview 2022, please contact article author.
