Hanoi (VNA) – Vietnam’s dairy industry plays an important role in ensuring nutritional security and improving public health while supporting agriculture, livestock farming, processing, trade and services; however, amid deeper international economic integration, it faces growing pressure to improve productivity, quality, technological capacity and food safety.
Deputy Minister of Industry and Trade Truong Thanh Hoai said despite positive results in recent years, the industry continues to face major weaknesses. Domestic fresh milk supplies currently meet only about 40% of processing demand, making the sector heavily dependent on imported raw materials.
Nguyen Xuan Duong, Chairman of the Vietnam Animal Husbandry Association, said domestic fresh milk production meets only 38–40% of processing demand, with the remainder relying on imported milk powder. This weakens the domestic dairy farming value chain.
Without timely and strong policy measures, Vietnam will struggle to meet its target of domestic sources supplying 60% of raw milk demand by 2030, Duong warned. The country currently has only about 3.3 dairy cows per 1,000 people, well below Thailand, Japan and the Republic of Korea.
Dairy farming and herd expansion have also stagnated. After growing by 15% between 2010 and 2015, the national dairy herd has expanded by an average of only 0.4% annually since 2020. Vietnam now has around 350,000 dairy cows, producing more than 1.3 million tonnes of milk annually.
Land shortages for growing grass and securing feed supplies remain major obstacles to large-scale farming, while small-scale producers also face difficulties, according to industry representatives.
Without timely support for breeding stock, grass cultivation and by-product processing, they will find it difficult to compete with enterprises operating large-scale, integrated production chains, said Tong Xuan Chinh, Vice Chairman and Secretary General of the Vietnam Dairy Association.
Dr Phung Quang Truong, Deputy Director of the Ba Vi Cattle and Forage Research Centre, noted that fresh milk purchase prices remain at 12,000–14,000 VND (0.47–0.55 USD) per kilogramme, while rising feed costs are squeezing farmers' profits. Farmers also depend heavily on dairy companies for market access, leaving them with limited bargaining power.
Vietnam's dairy market still has considerable growth potential. Annual milk consumption stands at around 24–27 litres per capita, compared with 35 litres in Thailand, 45 litres in Singapore and 80–100 litres in Europe.
The Government has approved the strategy for dairy industry development through 2030, with a vision to 2045, which targets annual industry growth of 12–14% by 2030, domestic raw milk production of 2.6 billion litres per year (meeting 60–65% of demand), and average consumption of 40 litres per capita annually. By 2045, raw milk production is expected to reach 8 billion litres per year (meeting 80–85% of domestic demand), and annual per capita consumption to reach 100 litres.
To achieve these goals, Duong proposed developing high-tech intensive farms run by large businesses alongside professionally managed household farms with 30–50 cows, making better use of rural labour and agricultural by-products.
He also called for stronger links among enterprises, cooperatives and farmers to secure stable supplies, create jobs and raise incomes.
Experts recommended that Vietnam learn from the experiences of the Philippines, Indonesia and China in introducing mandatory minimum proportions of domestically produced fresh milk in dairy processing, alongside preferential capital, credit and tax policies for enterprises purchasing domestic milk beyond prescribed requirements.
Nguyen Viet Tan, Deputy Director of the Ministry of Industry and Trade’s Department for Science Technology and Digital Transformation, said relevant authorities are considering amendments to national technical regulations on liquid milk and encouraging businesses to adopt advanced technologies, cleaner production methods, digital management and traceability systems./.
VNA
