BEEF CATTLE VALUE CHAIN IN SCC VIET NAM

& INTERVENTION FOR IMPROVEMENT

Presented by Ho Cao Viet

Quy Nhon, 5-6 March 2013

Institute of Agricultural Sciences for

Southern Vietnam

Production & consumption of beef in

global market & Vietnam

Source: Beef Industry Analysis. Agricultural Industries Group. 2012.

Source: Beef Industry Analysis. Agricultural Industries Group. 2012.

India is largest exporter in 2012 (1,68 mi.tons;

expected 2,16 mil. Tons in 2013)

Source: Beef Industry Analysis. Agricultural Industries Group. 2012.

4th largest importer; imported beef meat 300 tons per year

Beef-cattle production in SSC, 2005-2011

In 2011-2012: Price of beef

meat: 180-320 thousand VND (9-16USD)/kg

100

150

200

250

300

350

2005 2006 2007 2008 2009 2010 2011

Beef-

catt

le (

1000 h

ead)

Bình Định Phú Yên Ninh Thuận

2009-2011: Trend to move down by

4-5%

Source: General Statistic Office, 2011-2012.

Methodology & methods

Methodology of research Describe & positioning structure of

chain

Financial & cost-benefit

analysis

Agents & overall chain

Strategy & Intervention

to improvement

of chain

Feedback of local

beneficiaries

New projects /programs

Qualitative & Quantitative

methods

Major supply chain of beef-cattle in SCC

Farmers

Collectors

Dealers, distributors

Retailers,

processing units

Slaughter

houses

Beef-cattle

Beef-cattle

Meat, Born & by-products

Meat, Born & by-products

Product line

Production stage

Marketing stage

Description & positioning beef-cattle value chain in SCC

70%Beef

75%Beef

25% Beef

Meat & by-products

Meat

leather

Farmer Slaughter

houses

Leather (10%)

Meat (30%)

Born, bood

Slaughters in Dong Nai & HCMC

Local market

ProvincialDealer

Distributors

Factories in HCMC

Retailers

Market in HCM city

30% Beef

Middle men

Financial parameters in value chain of cassava and beef cattle

Inputs Total production (P)

Intermediate costs (I.C)

Value of main products Value of by-products

Input materials

Added Value (VA)

Hired labor cost Financial cost Taxation

Gross Profit (GPr)

Depreciation

Net Profit (NPr)

Value Added analysis of overall chains

IC Farmer

IC Processing

IC Trading

P Farmer

P Processing

P Trading

VA Farmer

+

VA Processing

+

VA Trading

IC Farmer

IC Processing

IC Trading

GPr Trading

VA chain

India become beef-meat largest exporter

in 2012, WHY ?

Major factors: 1-Competitive low price beef 2- Export-oriented slaughter units 3- Robust demand for lean 4- Provide halal product (exported to Malaysia) Source: Merco Press – South Atlantic News Agency (2012).

Intervention for improvement of beef-

cattle value chain in SSC

Prerequisites of a successful food system

Source: CAPI, 2012.

Two approaches for marketing strategy

Source: CAPI, 2012

Feedback of beneficiaries on beef-cattle value chain

intervention for improvement

18 questions relating to strategy and solution for improvement of chain

16 samples of beneficiaries: 18.8% farmers; 18.8% local collector; 18.8% slaughter house; 43.8% officer/staff in DARD/local gevernment

Question on “farmer, local collector, slaughter coordination in marketing in order

improve added value of chain”

no comment

very adaptable

Question on “efficiency credit program for husbandry (amount of loan, relevant interest

rate, technical support)”

no comment

very adaptable

Increasing productivity on-farm

The key drivers of farm profitability are: Increasing pasture, forage and

supplemental feeds utilization rates (Q5:62.5%; 37.5% very adaptable)

Reducing mortality Increasing carcass rate Increasing price per unit sold Reducing feed costs per unit sold

Technical solutions to increase productivity on-farm

Higher performance programs for breeding &

artificial insertion (Q2:81.3%)

Introducing high-biomass grass varieties &

adapting with extreme weather condition

(Q4:100%)

Applying nutrients-balance, modify micro-

elements & mineral salt, fattening by cassava

products, fermented by-products (rice straw,

cassava leaf, etc.) (Q5:100%)

Technical solutions to increase productivity on-farm (cont.)

Increasing ratio of vaccination &

mapping for disease prediction (Q10:93.8%)

Training farmers on marketing skill (Q8:93.8%)

Applying husbandry technics towards

organic farming and GAP

Improve supply chain & market information

Transparence in price & transaction mode (farmers-collectors-middlemen) (81.3%)

Uploading website for market-price analysed information

Organizing auction systems for cattle (31.3%)

Policies to encourage beef-cattle husbanry towards high-quality, safety and competitive price, target to high-income domestic market and exportation (87.6%)

Improve supply chain & market information (cont.)

Improving size of herds & develop specialized-farm in relevant regions (81.3%)

Doing markert studies, finding out new high-competitive markets , in term of price and quality (organic farming, natural grazing, non-use chemicals and industrial feeds)

Thanks for your attention !