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Imported milk keeps prices high   2009-01-13 - Viet Nam News

Viet Nam still has to import nearly 80 per cent of its milk to meet domestic demand, according to statistics recently released by the Ministry of Industry and Trade.

A Vinamilk dairy production line. Viet Nam still has to import nearly 80 per cent of its milk to meet domestic demand.

Although the dairy farming area in 2008 expanded 1.5 times compared to the previous year, domestic farmers produce only 234,000 tonnes of milk per annum - meeting a mere 22 per cent of demand at home.

The dependence on imports is threatening to keep prices high at home.

According to the ministry, the shortage of domestic milk materials is because farmers at home work on a small scale and are not highly trained.

To solve the problem, the ministry urged the Government to issue a policy on developing the dairy farming area, supplying farmland with technology, and supporting the skilled labour force. They also called for a policy on setting suitable prices for milk.

The ministry also asked for better regulations to make sure milking areas are closely controlled to keep an eye on quality and food safety.

In response to the problem, the country's largest milk producer, Vinamilk, has its own plans to build high-tech dairy farms in various provinces like Nghe An, Vinh Phuc, Lam Dong, Binh Dinh, Binh Duong, Soc Trang with a capacity of 30 million litres of fresh milk per year for each farm.

The country's dairy industry plans to meet 34 per cent of total domestic demand for milk material in 2015 and 38 per cent in 2020.

Why so high?

Despite falling prices on the global market since earlier December, the cost of milk goods in Viet Nam are still up.

According to experts in the industry, the price of imported milk goods decreased by about 40 per cent to US$3,400 per tonne for cream powdered milk and $4,500-5,000 per tonne for high-fat powdered milk.

But, domestic prices remain high, from VND85,000 to 159,000 for a 400g can and from VND179,000 to 400,000 for a 900g can.

Deputy general director of Vinamilk Tran Bao Minh said the company had not cut prices because of the high cost of materials for production. According to the company, the cost of producing tins of powdered milk had recently risen by 50 per cent, and butter surged by 80 per cent.



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