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Big plans for local vegetable oil
Viet Nam has set a target to produce 1.7-2.16 million tonnes of vegetable oil by 2020, of which roughly 60,000 tonnes will be exported. This is more than 500,000 tonnes above present production.
According to a Ministry of Industry and Trade draft plan to develop the vegetable oil industry until 2020 with a view to 2025, the industry aims to churn out 2-2.65 million tonnes by 2025.
However, to meet the target, Deputy Minister of Industry and Trade Bui Xuan Khu recommended that the Government should make bold policies to encourage the development of raw materials.
Khu emphasised the biggest problem faced by the industry was not a lack of capital to build more factories, but a lack of areas to grow raw materials.
The current oil industry was reliant primarily on imported materials. "Up to 90 per cent of raw materials must be imported," Khu said.
To date, the country has not found a key crop to cultivate on a large scale for vegetable oil production.
Rice bran in the Cuu Long (Mekong) Delta could be a suitable raw material, considering 400,000-500,000 tonnes per annum are produced. However, the cost of transporting such a large volume of raw product to the factories would be significant. This explains why the factory in Can Tho still does not operate at full capacity (only 80,000 tonnes were collected in 2008).
Viet Nam now has about 35 vegetable oil producers in 13 provinces and cities. They churn out 1.13 million tonnes of refined oil and 85,000 tonnes of unrefined oil per annum. According to statistics from the Ministry of Industry and Trade, the vegetable oil industry last year earned a turnover of VND6.62 trillion (US$370 million), accounting for 4.62 per cent of the total value earned by the country’s food and drink industry, or 1.02 per cent of the total value earned by the industrial sector as a whole.
It was estimated that the vegetable oil consumption of Vietnamese people last year was 7 kilogrammes per capita.
Vietnamese vegetable oil consumption is expected to grow by 8 per cent during 2008-18 and 3.5 per cent during 2018-25. This growth would result in a consumption volume per capita of 15.2 kilogrammes by 2018 and 19.4 kilogrammes by 2025.
From 2000 to 2008, Viet Nam’s vegetable oil imports increased by 12.6 per cent on average, while exports decreased. Last year alone the import turnover was $700 million.
Experts have warned that if Viet Nam does not have an effective prog-ramme to cultivate raw materials for vegetable oil, it will have to import $1 billion worth of materials by 2015.
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