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Insiders skeptical over throwaway prices of US chicken imports in Vietnam

Wednesday, July 01, 2015, 11:24 GMT+7
Insiders skeptical over throwaway prices of US chicken imports in Vietnam
Consumers choose chicken at a supermarket in Ho Chi Minh City.

With chicken products imported from the U.S. fetching much lower prices in Vietnam than their home country, insiders of the Vietnamese poultry industry have cast doubt on the honesty of the importers.

Vietnam imported nearly US$54 million worth of chicken products in the first five months of this year, equaling 52 percent of the full-year imports in 2014, according to customs data.

The U.S. market accounted for 65 percent of the five-month import value, or $34.8 million, and American chicken is the cheapest among Vietnam’s poultry meat suppliers.

While frozen chicken wings from Brazil and Argentina are imported at $1.9 and $2.1 a kg, respectively, the rate is only $1 a kg for the U.S. products, according to customs figures.

Chicken legs are shipped from the U.S. at only $0.9 a kg, compared to $2.1 a kg from Lithuania.

The $0.9, or roughly VND20,000, price is “as cheap as vegetables,” which no local meat suppliers are able to compete with, according to the director of a poultry company in the southern Vietnamese province of Dong Nai.

“Even by selling at a loss, we will never be able to compete with the imported products,” the director told Tuoi Tre (Youth) newspaper, speaking on condition of anonymity.

Comparison of prices in VND of different chicken parts between domestic (right) and imported products. Photo: Tuoi Tre

The cheap, easy to preserve imported chicken meat has thus become the favorite of local eateries and facilities that supply meals for factories, schools and hospitals, exacerbating the hardship of the local poultry sector.

But the biggest mystery to local industry insiders is how the chicken can be cheaper when imported to Vietnam than it is in the U.S.

“I’ve been to some supermarkets in the U.S., where chicken legs fetch $1.5-2 a pound, or VND60,000-80,000 a kg,” said Phi Long, a chicken farm owner in the southern province of Dong Nai, who recently returned from a U.S. trip.

“But the products are imported at only VND16,000 a kg, and on sale at VND19,000, which is incredible.”

Nguyen Van Ngoc, deputy chairman of the Animal Husbandry Association in southeastern Vietnam, said the import rates of U.S. chicken must be equal to the cost prices to raise the poultry domestically.

“But the imported products now fetch abnormally cheap prices,” he said.

Ngoc thus called on local authorities to verify whether the cheap products are “those that are near or exceed expiration dates and therefore are sold at dirt cheap prices to Vietnamese importers.”

Le Ba Lich, chairman of the Animal Husbandry Association of Vietnam, also said it is unreasonable that U.S. chicken legs are priced at less than a dollar in Vietnam.

“We cannot rule out the possibility of trade fraud in the importation of the products,” he said.

“The importers might have bought nearly-expired products at throwaway prices and altered their labels before selling them to [Vietnamese] consumers.”

Lich added that a bird flu outbreak has hit the U.S. since the end of last year, so poultry companies there might also want to empty their unsold stocks at cheap prices.

“I have no idea why Vietnam still licenses the import of chicken legs and wings in large quantities despite the serious bird flu outbreak,” he said.

“Vietnam only suspended imports on May 1, but products whose contracts had been signed prior to that point are still arriving.”

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