Mr Giao said that the lesson of catfish breeding might be repeated with milk cow farming if dairy prices kept rising. Encouraged by the high prices of dairy products, every household tries to breed cows, and every locality tries to develop a herd of milk cows, including ones that do not have good conditions for farming.
Mr Giao said that his department was going to send dispatches to local departments under MARD to warn about the risk, and ask local authorities to pay special attention to their milk cow herd development programme.
How will the fresh milk price hike impact cow breeders and the milk cow development programme?
On June 23, Dutch Lady officially announced it would raise material milk purchasing prices to VND6,200-6,500/kg. Vinamilk has also raised purchasing prices three times since the beginning of June. When I called several dairy processing workshop owners, they all said they planned to raise purchasing prices. One month ago, the milk price increased from VND4,600 to VND5,000/kg, and now jumped from VND5,000 to VND6,500/kg.
It is understandable why milk prices increase: the demand for dairy products has increased by 35-100% in the world, while the supply is short due to the droughts. On June 4, in Chicago, the milk price hit its record at $21.5/100 pounds. Meanwhile, several countries have cut subsidises on milk production, leading to the price hike.
In fact, the purchasing price of material milk in Vietnam is lower than in other regional countries. The higher purchasing price will bring opportunities to milk cow farming, especially localities suitable for cow farming. To some extent, the milk price hike will help the domestic dairy market develop. It is hoped that by 2010 domestic output will meet 40% of the domestic demand. However, it would risky if the price soared to an overly high level. If farmers can make the profit of VND1,500-2,000 for every kilogramme of fresh milk, farmers will rush to breed cows, even when they do not have good conditions. As a result, breed cows will become rare and the price will escalate.
Another risk I have to mention is that cows may be overexploited and become exhausted. This will result in a worse quality of milk if cows suffer diseases due to bad investment. Farmers may get profit in the first one or two months of breeding, but they then will suffer as the milk output will decrease. Besides, the foodstuff for cattle will be seriously short.
How many more cows will we have with the current price increases?
We had 113,000 cows by August 1, 2006. It is estimated that the figure has risen to 120-125,000 now, while the green fodder for cows we can provide just can meet 33-35% of the need. I think that the herd of cows will develop rapidly if the current price increases maintain, estimated to reach 150,000 cows by the end of this year.
How about the capability to provide breed cows if massive farming occurs?
The lack of breed cows may occur. Only 55,000 of the existing 113,000 cows can reproduce, and they can give 42,000 calves. Only a half of the 42,000 calves are milk cows, and 30% of the half will be wedded when they grow. As such, we can provide 14-15,000 breed cows every year only.
We try to limit importing breed cows and we will import only when the imported cows can meet several requirements. The Lam Son Sugar Company is planning to import breed cows in large quantity, several units, which will arrive in August.
Do you think that the milk price hike will help recover the milk cow development programme which once experienced a very difficult period? What will we have to do to develop the herd of cows?
It is necessary to programme the milk cow development. Cow farming should not be seen as a job for poor people. We once advised farmers in the Mekong River Delta, where floods come regularly, and in poor and hot provinces like Ha Tinh, Quang Binh, Quang Ngai and Thua Thien-Hue not to farm milk cows, but they have ignored our suggestions.
A milk cow can provide 4,500 litres of milk a year at maximum; however, the milk output depends much on breeding technique. Tuyen Quang province, for example, has recently announced the bankruptcy of its milk cow development programme though it made heavy investment in it. Now the province has two cow farms, one was sold to Vinamilk, and another is still under the management of local staffs. The Vinamilk-run farm can provide 20 litres/cow/day, while the other just provides 10 litres/cow/day. It is because of bad management.