Pig breeding firms report surge in profit

Wednesday, Jun 10, 2020 08:15

A pork slaughtering chain at Vissan. — Photo courtesy of dangcongsan.vn

Many large pig breeding farms in the country have reported a surge in profits in the first months of the year thanks to high prices due to a supply shortage.

Bac Ninh-based Dabaco Group has reported its highest-ever profit growth in the first quarter of VND348.7 billion (US$14.9 million), 17 times higher than the same period last year, on revenue of VND 2.38 trillion ($102.15 million), a year-on-year increase of 41 per cent.

The African swine fever outbreak caused the pork shortage in the domestic market, resulting in high pork price for a long period.

Its five-month after-tax profit was worth nearly VND593 billion ($25.5 million), 30 per cent higher than the target for the year.

This year, Dabaco targets achieving over VND13.2 trillion in revenue and nearly VND460 billion profit after tax, an increase of 84 per cent and 51 per cent, respectively.

With good profit prospects this year, it plans to pay dividends at 25 per cent, of which 15 per cent will be paid in cash and 10 per cent in shares.

Dong Nai Agricultural Livestock Products JSC (Dolico) reported a pre-tax profit of VND39 billion ($1.67 million) in the first quarter, or 141 per cent higher than its target.

In the second quarter, Dolico aims to produce 855 tonnes of pork, and achieve a total revenue of about VND65 billion ($2.79 million) and profit before tax of VND15 billion ($644,333).

Similarly, VISSAN JSC also enjoyed good profits from pig raising activity.

The company's net revenue in the first quarter increased by nearly 21 per cent over the same period, reaching more than VND1.45 trillion ($62.2 million). Of the figure, the revenue from fresh meat accounted for nearly VND669 billion, revenue from processed food is about VND742 billion.

Its profit in the first quarter was up by nearly 20 per cent over the same period last year to nearly VND47 billion ($2.02 million).

Vissan has focused on two main segments: fresh food and processed food. Its slaughtering capacity is about 2,400 pigs and 300 Australian cows a day.

The price of pork has steadily increased from the end of last year and hit a 20-year high of VND103,000 ($4.4) per kilogram last month despite efforts to pull down prices from authorised agencies.

Nguyen Nhu So, Dabaco’s chairman, said total domestic pig herds could only return to the figure before the African swine fever by the end of this year.

Total pig herds at Dabaco are expected to increase by 15 per cent this year over last year, making it the Vietnamese firm with the largest pig herd in the country, he said.

To contain prices in the domestic market, in addition to encouraging more pig breeding, authorities have been increasing meat imports from Canada, the US, Russia and Germany, and have allowed for the first time the import of live pigs from some countries.

However, with the current market situation, So said until the end of 2020, pork would not return to cheap prices as before. The pork price in the world market would be as expensive as in Viet Nam.

"No country has prepared enough food before the pandemic and has enough (pork) to export," So said. — VNS

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