Ong Tho condensed milk and its 40-year journey

(Baonghean.vn)- Cans of Ông Thọ condensed milk, once a luxury item for well-off families, are now available in every region of the country and in many countries around the world as a daily necessity for every family...

In early July 2016, the Driftwood dairy factory in the US, 100% owned by Vinamilk, introduced condensed milk and creamer at the Fancy Food Show. This is one of the largest food industry fairs in the US, attracting thousands of prestigious businesses in the field of food processing and production from many countries.

At the end of the fair, these products were sold in supermarkets in Arizona and California. Entering the US market is not easy. Condensed milk and creamer produced in Vietnam must ensure quality, food hygiene and safety for the food industry in general and the dairy industry in particular, and must be recognized by the FDA and USDA for quality and granted import licenses.

Previously, Vinamilk condensed milk products were exported to Japan, Canada, Korea, the Middle East, ASEAN, Africa... with the brands Ong Tho, Bestcows, Angle, Captian, Driftwood, Southern Star..., accounting for 34% of the company's export output in 2015.

Ms. Mai Kieu Lien - General Director of Vinamilk acknowledged that the current position is the "sweet fruit" of persistently building the Ong Tho condensed milk brand for 40 years. The company currently owns 13 factories in Vietnam, 3 factories in the US, New Zealand and Cambodia. Of which, 4 factories in Vietnam and one factory in Cambodia produce condensed milk products with a total capacity of more than 300 million cans per year, meeting domestic and export demand.

Vinamilk's Angkor Milk factory in Cambodia produced its first batch of condensed milk on its inauguration day.

"At that time, condensed milk was considered a luxury because it was too scarce and expensive. Condensed milk boxes were distributed according to standards, although the cans had yellowed packaging when they reached consumers, but they were still the dream of many people. Only sick people, children, and the elderly could drink a cup of milk to improve their health," Ms. Mai Kieu Lien recalled. The journey of condensed milk began after liberation, when Vinamilk took over 3 factories in the South, including Thong Nhat factory, Truong Tho factory, and Dielac factory. The economy faced many difficulties, old technology equipment, and no foreign currency to import raw materials, so businesses were completely passive in production. The factories only ran at less than 1/20 of their capacity, producing only a few thousand cans of milk each month.

To solve the difficulties, Vinamilk's leaders proactively entered into joint ventures with import-export enterprises with strong foreign currencies, especially Seaprodex. At the same time, the company launched the Ong Tho condensed milk brand. This is a high-end product line, sold at Cosevina and Imexco stores for on-site export to earn foreign currency to import raw materials. As a result, from the initial few hundred million VND, the company increased its equity capital to 20 billion VND in 1987, increasing output and revenue beyond the plan.

The success that had just been achieved was lost in the early 1990s. Due to the economic embargo, Vinamilk could not import spare parts for production, and had a passive source of raw materials. Engineers and workers together overcame difficulties by designing the embossed image of Longevity, creatively processing milk can lid molds, and utilizing war scrap such as tank wrecks and artillery barrels...

"We are 'blind' to information about world market prices, while raw materials are completely imported, we do not exchange with the outside, and we have a passive source of strong foreign currency. How to reduce purchasing prices, thereby reducing product costs is a difficult problem," said Ms. Lien.

Ong Tho and Ngoi Sao Phuong Nam are the two condensed milk brands most chosen by consumers nationwide, according to research by Kantar Worldpanel.

On the other hand, Vinamilk has planned to develop a domestic dairy farm system to gradually become self-sufficient in raw materials. Since the 1990s, Vinamilk has researched and signed contracts in host countries and directly purchased raw materials such as milk powder, avocado oil, etc., at prices several hundred USD per ton cheaper than the import price through import-export companies. Thanks to that, product prices have decreased, competing with imported goods.

After the economic embargo was lifted, Vinamilk entered a new phase of development. The company imported modern machinery to boost production and improve quality to meet the increasing domestic demand. The model of linking with farmers to expand the breeding area, and at the same time forming its own dairy farms from North to South helped the total herd from 3,000 cows in 1991 to over 120,000 cows in 2016, producing 200,000 tons of milk per year.

"This is an important turning point. Thanks to that, Vinamilk has proactively sourced milk materials for production. The strategy of combining modernized machinery and equipment, world-leading advanced technology with raw material areas from 1991-2003 has helped the company take up to 75% of the condensed milk market share," said Ms. Lien.

After equitization in 2003, Ong Tho milk is still Vinamilk's main product, always in the top of high-quality Vietnamese products. To keep up with changing consumer tastes, the company has expanded its product portfolio, improved designs, quality, and diversified product types to suit different needs.

In the domestic segment, many condensed milk products have been launched such as Ong Tho white quick-open lid, Ong Tho red, Ong Tho green letters, Southern Star green, red, orange and blue. When exported, Vinamilk condensed milk products also have many different names such as Bestcows, Angle, Captain, Driftwood...

Vinamilk's condensed milk products are diversified in packaging with tin cans, paper boxes and plastic blister packaging.

Packaging is also diverse in types and volumes such as 380g tin can packaging, 1-liter paper box packaging and 40g small plastic blister packaging for single use. The can design has changed from normal to ribbed, helping to reduce the thickness of the tin, making it convenient to stack. The label on the tin can has been improved from regular paper label to high-quality glossy paper label, creating a luxurious and beautiful style.

"Over the past 40 years, Vinamilk condensed milk in general and Ong Tho condensed milk in particular have become familiar to Vietnamese consumers through the image of a hot cup of milk coffee every morning or a delicious flan cake, the image of childhood eating bread dipped in milk, and cool yogurt prepared by housewives at home. This is also a product included in the toxic nutrition regime for many workers nationwide," Ms. Lien shared.

It is estimated that of the more than 300 million cans of milk produced this year, about 34% will be for export.

PV