The Vietnamese dairy industry hopes to grow at 20-25 percent annually through the next decade spearheaded by yoghurt products, according to the Animal Husbandry Department.

Yoghurt accounts for just 12-20 percent of milk-based products in Vietnam compared to 50 percent in many countries.

The Vietnam Dairy Products Joint Stock Company, or Vinamilk, is the largest player in the dairy market, selling fresh and processed milk, sweetened condensed milk, yoghurt, and other products.

Its revenue from yoghurt sales last year was 2 trillion VND (105.3 million USD), which accounted for 60 percent of the total yoghurt market.

Many other companies like the International Dairy Products Joint Stock Co (IDP) and Kido Dairy Products JS Co have recently entered the yoghurt market, some with success.

Nguyen Tuan Dung, deputy general director of IDP, which makes Ba Vi yoghurt, said realising the potential of the market, IDP has bought probiotics, a kind of micro-organism that aids fermentation, from Denmark to make yoghurt products.

For IDP, revenue from yoghurt is growing at the fastest pace among all dairy products, he revealed, adding that its Ba Vi brand is becoming popular around the country, especially in the north.

To improve their competitiveness, many companies are developing their own dairy farms to source raw materials while some others have opted to have tie-ups with dairies.

IDP, for instance, offers interest-free loans to farmers in Ba Vi district near Hanoi to buy dairy cows and equipment like milking machines, with farmers repaying them by supplying milk.

This has not only helped the company set up a stable source of supply but also brings a considerable income to farmers, Nguyen Manh Khan, deputy chairman of the Tan Linh Commune People's Committee in Ba Vi, said/.