Pig Genotypes in Vietnam: Demand versus Supply

1. Pig Genotypes in Vietnam:Demand versus Supply Patrice GAUTIER, Dr Vet Director of Operations Asian Veterinary & Livestock Services JSC patrice@asvelis.com Hanoi 7th April 2009

2. Study Summary • Objectives • Method • Contributions & Peer-review • Locations studied • Outputs

3. Objectives • Assess the suppliers of all types of pig genotypes. • Assess the gap between supply of and demand for pig genotypes (with case studies). • Identify feasible solutions to address the gap via technology, policy, and/or institutional options.

4. Method • Literature search & reading. Document some past experiences in Vietnam • Organize 2 workshops (Hanoi + HCMC) • Discuss with many key informants • Field visits • Draft report reviewed by peers • Final report

5. Contribution & peer-review • Pork processors (Duc-Viet …) • Retailers (Big C, Metro) • Manufacturers of animal feed • Manufacturers of veterinary products • Pig specialists (management, nutrition, animal health) • Genetic companies • Hanoi & Thai Nguyen Agriculture Universities • Liege & Toulouse Faculties of Veterinary Medicine • Institute of Agriculture Sciences for South Vietnam • NGO: AVSF & ARLDF • Trade offices of EU, Canada, Hong Kong & USA • Etc.

6. Locations visited • North: Thai Nguyen & Hung Yen • South: Dong Nai & Tien Giang Past visits and work on pigs (2000-2008) • North: Ha Tay, Hanoi, Ha Nam, Hai Duong, Thai Binh, Thanh Hoa, Bac Ninh, Phu Tho, Vinh Phuc, Yen Bai, Son La. • Centre: Nghe An, Quang Binh • South: Ninh Thuan, Dong Nai, Tien Giang Note: Overall, the study report may reflect more the situation in northern VN (study team). Specifics aspects of central highlands may be missing in the report.

7. Outputs Outputs requested by Terms of Reference • An updated census of the suppliers of pig genotypes (not final). • Some case studies described. • Gaps identified between supply of and demand for pig genotypes. • Feasible (and less feasible?) solutions have been formulated. • The draft report has been peer-reviewed. Indirect outputs (not requested by the Terms of Reference) • A proposed new classification of pig farming systems. • Discussion about set up of pig associations in southern Vietnam. • Contribution to better information for many stakeholders. • Contribution to decision-making for some breeding companies. • Increased information-sharing between key pig experts.

8. Suppliers of Pig Genetic in Vietnam • Indigenous genotypes • Western genotypes (PS) • Western genotypes (GP & GGP)

9. Suppliers of Indigenous Genotypes • Self-replacement for most indigenous genotypes (apart for Mong Cai) by ethnic minorities. No professional suppliers. • For Mong Cai • Around 13 suppliers located mainly in Red River Delta & costal north-central (see map) • 1-2 suppliers (Quang Ninh & Hai Phong) used by NIAH for research. • Biggest supplier = Tang Tien cooperative in Bac Giang. • Produce & deliver batches of > 50 MC gilts to upland areas (plus some exports to China & Laos) through projects (extension services, NGOs etc.) • Almost never sells directly to farmers! • Gilts sold to be mated with western genetic for small-scale production of cross-bred piglets.

10. Price of Mong Cai gilts sold by Tang Tien cooperative from 2002 to 2008. (VND per kg for gilts of around 15 kg Live Body Weight)

11. Suppliers of Western Genotypes • Production of GPP & GP pigs • Import • In-Country: France Hybrides VN; JSR-Darby; NIAH (ex-PIC); CP • Production of PS (parental sows & terminal boars) • Above entities • > 140 farms (public & private) • Production of boar semen • > 100 boar stations (from 1 to >10 boars) Also: • Some pork producers also sell some gilts for breeding purposes. • Some pork producers select best gilts from fatteners (self-replacement) • Few suppliers (north) sell cross-bred gilts (MC x LW-Ld)

13. Case Studies

14. The 6 main pig farming systems in Vietnam

15. Case studies • Moving from scavenging systems & piglet imports to small-scale piglet production with the use of artificial insemination • Yen Bai province • Moving from backyard or small-scale fattening to small-scale piglet production • Thai Nguyen province • Moving from small-scale cross-bred piglets production to medium-scale exotic piglet production • Hung Yen province • Moving from purchase of gilts to auto-production for gilt replacement • Hung Yen province • Medium-scale piglet & fattener production • Red River Delta • Moving from individual medium-scale production to a cooperative • Tien Giang province • Large-scale piglet & fattener production • Dong Nai & Binh Duong provinces

16. Recommendations

17. Recommendation 1: • To elaborate further on this report: • Need to form few groups of pig specialists, each group representative of each pig farming system. • Each group can use the following recommendations for discussion. • Report. • To then advise policy makers (Provincial & central levels) • Submit above reports • Draft and discuss policy papers, project proposals … • Finalize • Implement • Evaluate

18. Recommendation 2: Indigenous genotypes. Context • Some indigenous pig species have disappeared and some others are at high risk (research work from NIAH). • Some of these breeds are still used by many ethnic groups. • Niche market for some pork meat with strong taste? Recommendation • Breed conservation (the role & responsibility of NIAH) • Exploit & further study the potential of some of these breeds (cf. work done by Hohenheim University and NIAH …) • Support resource-driven pig farming systems (Son La, Yen Bai …) • Future niche markets for pork meat with high taste • Some of these breeds are useful as maternal sows for small-scale piglet production (cf. study case in Mu Cang Chai, Yen Bai).

19. Recommendation 3: Mong Cai sow + western male For Small-Scale Piglet Production Context • In many rural & remote districts of northern & central Vietnam, there is insufficient local production of piglets (and sometimes of fatteners). • As a consequence, small-scale fatteners (almost all rural families) result to purchasing piglets being transported from lowland / coastal areas. The ultimate consequences are: disease spread & low fattening productivity. • “Pig farming cannot increase here because additional pork would be difficult to market” (local agriculture officer). But, in these areas, pig farming can increase not to produce more pork but to produce more piglets: same number of fatteners produced / year but increased number of locally born piglets / year and decreased number of imported piglets / year.

20. Recommendation 3: (cont.) Mong Cai sow + western male For Small-Scale Piglet Production Recommendation • To strongly encourage the 13 private or public entrepreneurs who are already engaged and who want to engage into production of Mong Cai gilts. Subsidies are needed. • > 10,000 MC gilts are needed only for northern uplands (rough estimate). • The key constraint for development of small-scale piglet production is local availability of gilts (before credit, before technical advise …). • To further develop the supply of boar semen (western genotype) • To forbid projects that are too much subsidizing the set up of small-scale piglet production (too often practiced by NGOs, Extension Services …). Replace by loan + technical advice. • Not a funding problem: need to put subsidies on production of MC gilts more than on production of cross-bred piglets.

21. Recommendation 3: (cont.) Mong Cai sow + western male For Small-Scale Piglet Production Expected Results • Poverty reduction • More households (>10,000) would benefit from incomes generated by their new small-scale piglet production units • More income gained by the existing small-scale fattener production units (decreased losses because of decreased morbidity & mortality) • A way to gradually train (on-the-job) farmers in professional pig farming: some of these new piglet producers will move to medium-scale and move from MC sows to western sows. • Disease control: • Less movement of piglets from lowland / coastal areas to remote districts. Note that a similar recommendation is valid for the chicken sector: encourage entrepreneurs to set up hatcheries in upland areas.

22. Recommendation 4: Medium-Scale (10-500 sows) • Encourage the set up of cooperatives and engage into slaughtering + processing + retail. • Their needs in pig genetics: • Genotype quality: • Prolificity (cf. highly prolific or Sino-western hybrids – especially as labor cost is low in Vietnam) • Adaptation to tropical climate (example: research work on Pietrain by Liege + Hanoi universities) • Good lean meat ratio (but really depends on the end product, therefore does not need the very high lean ratio of some western genetic) • Health status of genetic purchased MUST be improved / known. • Most adequate model: < 50 sows (no employees needed).

23. Recommendation 4: (cont.) Medium-Scale (10-500 sows) One possible future model Moving from medium-scale to large-scale with a cooperative • 10 families (50 sows each) in a cooperative • Total of 500 sows + boars (western genotype) • Production of 10,000 fatteners / year or 27 fatteners / day • Invest in a collective slaughterhouse • Invest in a collective processing workshop • Invest in a retail point (selling meat directly to consumers)

24. Recommendation 5: Large-Scale (> 500 sows) Context: • Fairly big, big or very big Vietnamese or Foreign companies • Current supplies for genetics: • Import GP stock • Purchase GP or PS from France Hybrides VN or JSR-Darby • They produce PS for their own pork production (own farms or contract farms) and they often also sell additional PS to medium-scale producers. • Needs in genetics: high-lean ratio & prolificity. Recommendation: • Help professional genetic companies to develop their business in Vietnam • Those with selection/multiplication in Vietnam: JSR-Darby; France-Hybrides; CP … New companies will arrive. • Those who export GP directly for large-scale producers. • How? Need further discussions between authorities & them.

25. Other recommendations • Conduct an accurate annual census (for each province) • Number of < 10 sows units & number of sows • Number of 10 < > 500 sows units & number of sows • Number of > 500 sows units & number of sows • Implement performance recording, analysis & feedback on some pig farms (for each pig farming system). • Set up of 2-3 Regional Pork Institutes (North – Centre – South) • Certification of health status for suppliers of pig genetics • Etc.

26. CONCLUSIONS • Serious pig producers choose their pig genetic according to their skills, their facilities, the pork they can sell, etc. • Vietnam has a great potential to become a major pork supplier in Asia and to do so, the number of medium and large scale pig farming units needs to increase. • Better skills, facilities, linkages with the slaughtering/processing, disease management, etc. are essential and much more challenging than getting the right genetics. • There are two roads to reach professional medium or large-scale pork production: • Gradual move from small-scale to medium-scale • Set up more small-scale piglet producers • Own (or supported) gradual move to medium-scale • Cooperatives of medium-scale piglet & fatteners producers (with better linkages towards end of the chain) • Set up of medium or large-scale operations from scratch • Risky and therefore only for a minority.

27. France - 2008 • Study conducted for the French Government on how food prices are made in 2008. www.prospective.gouv.fr • Result with ham: • Price sold to the consumer: 12 Euros / kg • 89% of the margin made by intermediaries between the farmer & the consumer is made by the retailer (supermarkets) • Explanation: not enough competition between retailers. Figures in Euros / kg of ham

28. Conclusions (Cont.) • For the 1st time in France, an official report shows the margins made by supermarkets and confirms the weak competition between retailers. Solution for the French government: increase competition between retailers. • Therefore: High-quality western genotype + Large-scale intensive pig farm + Supermarkets & Exports = one of the possible models, but: • Only if there is sufficient competition between retailers (Choose the German example, not the French example!) • Only a very few number of pig stakeholders can do this (< 10 companies in Vietnam) • In France, some pig producers are fed up and do not want to depend on slaughterhouses & supermarkets! They go for smaller production capacity (< 100 sows) but have engaged into slaughtering, processing and sell their products directly to consumers (at a price cheaper than the supermarket!)