In the agricultural sector, the animal feed industry is attracting high levels of investment from both domestic and foreign sources. Additionally, this industry is experiencing deep levels of international integration, with over 65 countries and territories participating in the exchange of technology, equipment, and raw materials.
A recent report indicates that the global animal feed market size reached USD 482.1 billion in 2021 and is forecasted to reach USD 589.4 billion by 2027, with an estimated compound annual growth rate (CAGR) of 3.5% for the period of 2022-2027. These figures demonstrate the substantial growth potential of the industry in the near future.
The significant increase in the animal feed market size can be attributed to various factors. One such factor is the growth of population and income, which leads to an increased demand for meat, dairy, and other livestock products. This demand presents opportunities for feed businesses to expand production and access new markets.
Furthermore, sustainability and food safety have become important priorities in the feed industry. Consumers are increasingly interested in the origin and quality of livestock products. As a result, feed businesses have focused on implementing quality management systems such as ISO, HACCP, and GMP to ensure the safety and quality of their products.
With its development potential and strong international integration, Vietnam's feed industry has the opportunity to enhance its competitiveness and promote the export of livestock products to the global market. This not only brings economic benefits to businesses but also contributes to improving the position and reputation of Vietnam's agricultural industry on the global stage.
The scale of development of the animal feed industry in the Vietnam
With abundant raw materials resources, Vietnam has a high potential for the animal feed industry to grow. As of 2021, there are 269 animal feed production establishments, with 90 being foreign direct investment (FDI) enterprises and 179 being domestic enterprises. These facilities are predominantly concentrated in areas such as the Mekong River Delta, the Red River Delta, and the Southeast region.
In 2019, Vietnam's industrial animal feed output reached 18.9 million tons, and by 2021, it increased to 21.9 million tons, representing a growth rate of 15.9%. FDI enterprises account for approximately 60% of the output, while domestic enterprises account for about 40%.
While domestic enterprises own more factories compared to FDI enterprises, their market share is relatively modest. The total designed capacity of the entire industry stands at 43.3 million tons, with FDI enterprises accounting for approximately 51% and domestic enterprises accounting for about 49%.
However, Vietnam's feed processing industry boasts a relatively high total technology evaluation criteria score of 876 out of 1000. This indicates that the technological level of the country's feed industry is quite advanced compared to other countries. Moreover, domestic enterprises are increasingly expanding their scale, investing in modern technology, and implementing advanced management practices, placing them on par with FDI enterprises. Prominent examples include Dabaco and GreenFeed.
Current production facilities have prioritized the implementation of quality management systems in their production and business activities, utilizing synchronous automatic production lines. Previously, only around 30% of establishments applied quality management systems, but this percentage has now increased to over 80%, with at least one quality management system such as ISO, HACCP, or GMP.
The brand's revenue remained relatively stable at around VND 80.7 trillion in 2020 and 2021, experiencing a significant increase in 2022 to nearly VND 84.4 trillion. However, the profit after tax displayed a continuous decline over the same period, reaching nearly VND 18.4 trillion in 2020, decreasing by 56% in 2021 to nearly VND 8,400 billion, and further dropping by 42% in 2022 to nearly VND 4900 billion.
Cargill Vietnam's revenue has grown continuously for three years. In 2020, the group's revenue reached more than VND 17 trillion. This number increased by 56% in 2021 and grew by 7% in 2022, recording nearly VND 28.5 trillion. However, the after-tax profit of the brand was constantly changing. Specifically, in 2020, the profit after tax advanced toward nearly VND 940 billion. In 2021, this figure rose to nearly VND 1100 billion, up 15%. After that, profit after tax declined by 18% in 2022, reaching nearly VND 890 billion.
In the period from 2020-2022, De Heus's revenue recorded a continuous increase for three years. In 2020, the group's revenue reached more than VND 12.7 trillion. This number grew by 44% in 2021 and climbed by 35% in 2022, standing at nearly VND 25 trillion. However, the after-tax profit of the brand was constantly changing. Specifically, in 2020, the profit recorded about VND 950 billion. In 2021, this figure rose slightly by 9% compared to 2020, recording more than 1000 billion VND. After that, profit after tax fell by 60% in 2022, reaching VND 420 billion.
CJ Vina Agri
CJ Vina Agri's revenue recorded a continuous increase over the years. In 2022, revenue was recorded at more than VND 19.5 trillion, grew 11.3% compared to 2021, and rose 23% compared to 2020. However, profit after tax recorded a downward trend. Specifically, in 2020, the brand's profit after tax reached nearly VND 4,400 billion. This number decreased by 39% in 2021 and further dropped by 83% in 2022, approaching more than VND 450 billion.
CJ Vina Agri's revenue also recorded a continuous increase for three years. In 2022, revenue was at nearly VND 18.7 billion, up 16% compared to 2021 and up 36% compared to 2020. However, CJ Vina Agri's profit after tax had a strong downward trend. Specifically, in 2020, the brand's profit after tax reached nearly VND 2,000 billion. This number went down 99% in 2021 and decreased to a negative level in 2022, recording a negative profit of more than 1000 billion VND.
Greenfeed Vietnam's revenue and profit after tax recorded a continuous increase for three years. In 2020, the Greenfeed's revenue reached nearly VND 10.7 trillion. This number increased by 36.4% in 2021 and rose by 25.7% in 2022, approaching nearly VND 18.4 trillion. In terms of profit after tax, it reached more than 1100 billion VND in 2022, up 54.5% compared to 2021, and climbed 98% in 2020.
In 2022, Dabaco Group's revenue was nearly VND 11.7 billion, up 6.6% compared to 2021 and up 14.7% compared to 2020. However, the brand's profit after tax recorded a strong downward trend. Specifically, in 2020, the brand's after-tax profit will reach VND 1400 billion. This number decreased by 41% in 2021 and plunged to only VND 5 billion in 2022.
Proconco (Con co)
Proconco's revenue had been increasing continuously for three years. In 2020, the company's revenue stood at nearly VND 2900 billion. This number climbed by 32% in 2021 and rose by 9% in 2022, reaching more than VND 4100 billion. However, the profit after tax of the brand was constantly changing. Specifically, in 2020, profit after tax was nearly VND 700 billion. In 2021, this figure declined to nearly VND 1400 billion. After that, it decreased by 41% in 2022, approaching nearly VND 820 billion.
Sunjin Vina's revenue peaked at more than VND 3800 billion in 2022, climbing by 8% in 2021. In terms of profit after tax, Sunjin Vina recorded a downward trend in the two years 2021-2022. Specifically, in 2021, profit after tax was nearly VND 560 billion. This number fell by 37% in 2022, recording more than VND 350 billion.
Hong Ha Nutrition
Hong Ha Nutrition's revenue increased continuously for three years. In 2020, the group's revenue approached nearly 2800 billion VND. This number went up by 5% in 2021 and increased by 19.5% in 2022, peaking at nearly VND 4200 billion. However, the profit after tax of the brand was constantly changing. Specifically, in 2020, the profit was nearly 20 billion VND. In 2021, it decreased by 14%, recording a profit of VND 16 billion. After that, profit after tax increased again by 25% in 2022, standing at VND 20 billion VND.
Mavin Austfeed Group
In the period from 2020-2022, Mavin Austfeed's revenue had a continuous increase for three years. In 2022, the brand's revenue peaked at more than 2800 billion VND, an increase of 29% compared to 2021 and 69% compared to 2020. However, the brand's profit after tax had changed continuously. Specifically, in 2020, the profit reached nearly VND 200 billion. This number dropped by 63% in 2021, reaching more than VND 40 billion. After that, profit after tax declined again by 54.3% in 2022, recording more than VND 65 billion.
In this era of new economic transformation, businesses are encountering numerous challenges due to the impacts of volatile factors such as pandemics, political conflicts, rising energy and food prices, and increases in inflation and interest rates. However, it's also a time marked by a powerful wave of innovation across all economic sectors, including the livestock industry. Within the development strategy of this sector, the foremost priorities include bolstering the domestic raw material supply and accelerating the digital transformation to keep pace with advanced technology adopted by foreign enterprises. These initiatives will contribute to enhancing the competitiveness and global presence of Vietnamese brands within the worldwide value chain.
Source: Vietdata's 2022 Animal Feed Manufacturing Market Report