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Wheat demand leads to big rise in imports
An increase in wheat demand within the domestic market has led to a sharp increase in wheat imports during the first seven months of the year, as global wheat prices continue to rise.
More than 1.4 million tonnes of wheat were imported during the first seven months of the year, which is equal to the import volume for 2009, reported the Ministry of Agriculture and Rural Development (MARD). In July, 230,000 tonnes of wheat was imported, worth US$56 million.
Hoang Kim Giao, Head of MARD's Animal Husbandry Department, said the inflation of maize prices earlier this year prompted animal feed producers to begin to buy wheat.
Phan Hong Lien, an analyst at the Vietnamese Market Analysis and Forecast Joint-stock Company (Agromonitor), said wheat cost $220 per tonne for imports from Turkey and Russia, while imported maize prices stood at $240-250 per tonne.
Nguyen Hong Van, Deputy General Director of the Viet Nam Animal Husbandry Joint Stock Company, said his company followed the fluctuations of the world animal feed market and forecast that prices would continue to increase because of severe weather conditions in regions where the crop is produced.
The price of wheat, maize, cassava and rice were likely to increase sharply by the end of this year, he said. Therefore, the company had imported wheat to store when prices were lower earlier this year.
Pham Quang Dieu, Agromonitor's chief economist, said animal feed producers acted in an intelligent manner and exhibited their ability to capitalise on the global market.
The global price of wheat increased by 80 per cent against last month's prices. Wheat now costs $280 per tonne, a 23-year high, reports Agromonitor.
Le Ba Lich, Chairman of the Viet Nam Animal Feed Association said raw material imports for the animal feed processing industry increased sharply because domestic supplies were unable to meet the industry's demand.
In the first seven months of the year, the import value of raw materials for the animal feed industry saw a year-on-year increase of 30 per cent that was worth $1.38 billion. This figure excludes the importation of wheat.
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