Skip this Video
Download Presentation
On the economics of small-scale pig production

Loading in 2 Seconds...

play fullscreen
1 / 28

On the economics of small-scale pig production - PowerPoint PPT Presentation

  • Uploaded on

On the economics of small-scale pig production in Vietnam: survey results, analysis, and assessment Ma. Lucila A. Lapar, Nguyen Ngoc Que, Clement Tisdell, Nguyen Ngoc Toan, Nguyen Que Nga, Nguyen Thi Tam Ninh, Mohammad Jabbar and Steve Staal 7 th ASAE Conference Hanoi, Vietnam

I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
Download Presentation

PowerPoint Slideshow about ' On the economics of small-scale pig production ' - joella

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.

- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript

On the economics of small-scale pig production

in Vietnam: survey results, analysis, and assessment

Ma. Lucila A. Lapar, Nguyen Ngoc Que, Clement Tisdell, Nguyen Ngoc Toan, Nguyen Que Nga, Nguyen Thi Tam Ninh, Mohammad Jabbar and Steve Staal

7th ASAE Conference

Hanoi, Vietnam

14 October 2011


Aim of the Project

  • To identify options for technology, policy, and forms of market institution or coordination that will allow smallholder pig producers to raise incomes through better access to higher value chains (including niche markets) in the context of rising demand for products with specific quality attributes and within the broader context of the changing dynamics of the pig sector in Vietnam.

Project components

  • Consumer demand analysis (household consumer surveys in Hanoi and HCMC)
  • Producer and production system characterization (household producer and non-producer surveys in 6 provinces: Ha Tay, Phu Tho, Nghe An, Dak Lak, Dong Nai, Tien Giang)
  • Supply chain characterization (market actor surveys in Ha Tay, Dak Lak, and Dong Nai)
  • Pig sector modeling
  • Policy advocacy and communication

Hanoi, Ha tay

Phu Tho

Nghe An

Dak Lak

HCMC, Dong Nai, Tien Giang

Project survey sites across 6 agro-ecological regions of Vietnam


Preference rating for pork

Vietnamese consumers have a strong preference for fresh, unchilled pork; this provides natural protection from imported pork.


Changing nature of demand for pork

The majority of Vietnamese consumers indicated preference for lean pork compared to other types of pork.

No significant change in lean meat consumption from 10 years ago, but significant reduction in consumption of high fat meat from 10 years ago.


Preferred market outlets for fresh pork

Traditional market outlets remain the most preferred purchase outlets for fresh pork by Vietnamese consumers.


Dominance of pork in livestock total output

Source of data: FAOSTAT 2009.

Household pig production supply at least 80% of Vietnam’s pork.

But growth in supply has failed to keep pace with rising demand, resulting in accelerated increase in real pork prices.


Supply of pork in Vietnam

Most Vietnamese pigholding households keep very few pigs but on average the size of their herds is slowly rising. Although not shown, the percentage of pigholding households with 21 pigs or more rose from 0.3% in 2001 to 1.75% in 2006. 



of smallholders


Scale definition in household pig production

Production system definition:

Farrow to wean – piglet production

Farrow to finish – full cycle slaughter hog production

Grow to finish – pig fattening operation


Rates of return

Household-based pig producers earn revenues that can cover costs and generate some positive profits.


Gross margin (‘000 VND per kg output)

Household-based pig production can generate gross margins ranging from 4,000 to 15,000 VND/kg liveweight of pig produced.


Cost per unit output in household-based pig production

Economies of scale in piglet production; no significant difference across scale full cycle slaughter hog production and pig fattening


Increasing the proportion of own-produced feed to total feed use can decrease total feed cost. This provides cost advantage to small producers that use higher proportion of own-produced feed.


Cost-efficiency and economies of scale

    • Own produced feed is cheaper per unit of feed value.
  • As farm size increases:
    • Proportion of purchased feed increases
    • Effective unit cost of feed increases
  • Feed costs account for at least two-thirds of total costs.
  • Small producers can exploit this cost advantage to improve their competitiveness.

Share of pig income in total household income

Income from pigs accounts for about 14% of rural household income, or 24% of rural household income from agriculture.


Value added along the pork supply chain where household producers participate

Value added generated in pork value chains where household pig producers participate is about 11,700 VND per kg liveweight (or $0.62)


Share of retail price that accrues to producers (based on average pork retail price of 40,000VND/kg in 2007)

Producers receive at least half to two-thirds of the retail price of pork. This share increases with scale.


Employment generation in household pig production

Smallholder pig production generates employment estimated at about 4 million full-time labor along the pork supply chain, valued at about $3.3 billion or approximately 5.5% of Vietnam’s GDP in 2007.

Household labor constitutes the main labor inputs in household pig production.

Women labor accounts for at least half of total labor days in household pig production.


Implications on production efficiency

  • Smallholder pig producers are competitive in producing pork that meet the demand requirements of Vietnam’s fresh meat market.
  • Household pig producers are able to generate incomes from pig raising by exploiting areas where they have cost advantage.
  • Expanding options for own-produced feeds, in terms of choices and quality, can enhance their competitiveness, particularly in areas that are far from commercial feed sources, and complemented with improved access to extension.
  • Limitations in available land and household labor will be constraints to scaling up by household pig producers.

Implications on economies of scale

  • Within smallholder piglet production, marginal increases in scale can reduce cost and increase profitability (e.g., from 1 sow to 2-3 sows).
  • Due to lack of economies of scale in household pig production (except in piglet production), continued support to household pig production will likely improve overall efficiency of the industry.
  • It is not clear that policy support and investment in large scale operations will reduce unit cost of pork production or increase employment.

International Livestock Research Institute

Better lives through livestock

Animal agriculture to reduce poverty, hunger and environmental degradation in developing countries

Project website: