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Dong Nai Husbandry Association asks for Vietnam central bank's help amid financial woes

Dong Nai Husbandry Association asks for Vietnam central bank's help amid financial woes

Wednesday, March 29, 2023, 13:01 GMT+7
Dong Nai Husbandry Association asks for Vietnam central bank's help amid financial woes
A farmer is pictured taking care of his pigs in Vietnam. Photo: N. Tri / Tuoi Tre

Financial distress facing local farmers, farming households, and husbandry firms has prompted the Dong Nai Animal Husbandry Association to ask the State Bank of Vietnam, or the central bank, for help to survive the hardship and further thrive.

Chairman of the association Nguyen Tri Cong wrote to the central bank on Tuesday proposing extending principal payment deadlines and credit package validity, as well as lowering interest rates.

According to Cong, Vietnam had 10 million farming households 10 years back, which went down to four million households three years ago.

The number has reduced to a mere two million households recently.

Meanwhile, the soaring prices of animal feed, the low market prices for pigs and chickens, and African swine fever outbreaks have shrunk farmers’ production.

Apart from these challenges, domestic farming households and farms have come under pressure by fierce competition from foreign-invested firms with robust financial health.

“Most firms, farms, and farming households borrow money from commercial banks for their operations, but over the past few months, we have found it hard to access bank loans. Many have even accessed loan-shark funds to buy animal feed,” said Cong.

Commercial banks are proactively disbursing a financial relief package with an interest rate discount of two percentage points in line with the government’s Decree 31/2022 and the central bank’s Circular 03/2022.

However, few farms and farming firms have gained access to the package, said Cong.

Therefore, farmers and agricultural enterprises expected government agencies and the central bank to support them.

The representative of the association proposed that commercial banks work with it to analyze the potential of borrowers who are farming firms.

The association will guarantee firms with good performance to get loans.  

The timely support is expected to prevent farmers from reducing their herds of pigs, chickens, and cows, as well as incurring losses.

For the past few years, the price of animal feed has ticked up, while live pigs, chickens, and cows are selling for low prices.

The prices for live pigs is hovering at VND50,000 (US$2.1) per kilogram, while those of chickens range from VND22,000 ($0.9) to VND27,000 ($1.14) per kilogram.

The Vietnam Animal Feed Association had earlier proposed cutting the soybean import tax to zero from two percent to support the husbandry industry.

Many farmers said that the husbandry industry plays a role in guaranteeing essential food security for the country, while farmers follow effective and safe production directives issued by government agencies.

However, husbandry farmers enjoy fewer incentives than rice growers.

Rice farmers are allowed to store rice if they face poor consumption, but cattlemen are not entitled to this policy.

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Tieu Bac - Nguyen Tri / Tuoi Tre News


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