Pork could flood Vietnamese market after China cancels imports

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US pork imported into Vietnam will cause challenges for the domestic livestock industry. Photo: Internet

Low price of US pork

On August 1, US President Donald Trump suddenly announced that he would impose a 10% import tax on about $300 billion of goods from China from September 1. On the same day, the US Department of Agriculture also announced that China had cancelled a batch of US, with a volume of up to 14,700 tons, which was expected to be received this year and next year. In mid-May, Chinese traders also canceled orders to buy 3,247 tons of US pork.

The trade war between the world's two leading powers is becoming increasingly tense. With the latest activities related to pork products, experts predict that after being rejected by China, the US pork will flow to other markets to relieve excess of supply, especially the Vietnamese market.

Talking to reporters from the Customs Newspaper, Mr. Tran Cong Thang, head of the Institute of Policy and Strategy for Agriculture and Rural Development (Ministry of Agriculture and Rural Development), said recently, some US products have been promoted to export to Vietnam such as soybeans, fruits and meat. This trend will increase in the future, especially after the US Government imposed taxes on $300 billion of Chinese goods.

Particularly with pork products, the US has taken some actions to regulate production and support farmers because the quantity of goods exported to other markets, including Vietnam, cannot increase quickly. However, with excess meat that cannot be exported to China, the United States will boost exports to Vietnam.

"Due to the influence of the African swine fever, the supply of pork in Vietnam is limited at a high price. This creates more support for the US to export pork to Vietnam," Mr Thang said.

On this issue, Mr. Nguyen Kim Doan, Vice Chairman of Dong Nai Livestock Association, also predicted that the amount of American pork arriving in Vietnam after being rejected by the Chinese will be significant because the price of meat in Vietnam is high and, from now until the end of the year, pork supply will also be lacking. Currently, the price of US pork imported into Vietnam is about 26,000-30,000 VND/kg.

Regarding the price, Mr. Thang added that in the past 1-2 years, the average price of imported pork at the port was just over $1/kg. With the China-US trade war, US pork import prices may continue to fall when the US boosts their exports to Vietnam.

Concerns over poor quality meat

With the price of imported meat at only 26,000-30,000 VND/kg, Mr. Nguyen Nguyen Kim is worried that American meat entering Vietnam will cause difficulties and even squeeze Vietnam's livestock industry. Due to African swine fever, the cost of pig production was up to over 40,000 VND/kg. Meanwhile, at this time, the selling price of pigs is about 35,000 VND/kg.

From another perspective, Mr Nguyen Kim Doan posed the problem that the price of imported US pork is quite low. Meanwhile, American pork sold at supermarkets in Canada or the US is quite high, higher than the domestic meat price in Vietnam.

If imported meat was sold at the same price as in US supermarkets, the livestock industry could be competitive. However, it may be that low-priced imported meat is poor quality and the company does not import genuine goods.

With this problem, Mr. Tran Cong Thang said products sold in American supermarkets must also be included in the marketing process, so prices go up. Besides, product prices also depend on different consumer tastes, not product quality.

For example, with chicken products, in the US, drumsticks and wings are cheap, while breast is expensive. Meanwhile, Vietnamese consumers like drumsticks and wings. Vietnamese people prefer beef heel muscle but, in many markets,, consumers prefer soft shoulder meat.

According to Mr. Thang, when US pork is imported into Vietnam, consumers will be able to buy products with good prices and have more choice, but the producers will be disadvantaged. It is necessary to consider the benefit between the parties, ensuring support for producers to achieve profits.

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Some experts said that in the near future, if US pork is imported into Vietnam with a low price, it is necessary to take measures to protect domestic production and even impose anti-dumping duty.