Vinamilk and strategic steps in 30 years of developing the dairy farming industry
(Baonghean) - According to the General Statistics Office of Vietnam, by 2020 Vietnam will have 405,000 dairy cows, producing nearly 1.2 million tons of fresh milk each year. Currently, Vietnam is also the country that owns the largest Global GAP standard dairy farm system in Asia (belonging to Vinamilk).
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| All breeding cows are imported by Vinamilk from Australia, the US, and New Zealand and transported by special aircraft to Vietnam to expand the domestic high-yielding dairy herd. |
To achieve such impressive results, it is impossible not to mention the participation of Vietnamese dairy enterprises in building the dairy farming industry.
Right direction from the first step
To bring the name of Vietnamese dairy enterprises into the Top 50 largest dairy companies in the world after 4 decades of operation, one of the most valuable decisions of this billion-dollar dairy company is the mindset of investing in raw material areas very early, right from the beginning of the 90s.
Ms. Mai Kieu Lien - General Director of Vinamilk once shared: "We have a dairy farming system, that is the most important. This will help us to be self-sufficient in raw materials, self-sufficient in everything, self-sufficient in prices. It is not an exaggeration to say that without the raw material area, there probably would not be Vinamilk today."
The period after the country's reunification from 1975 to 1986 was a difficult time in all aspects of the country. But right from that time, Vinamilk's representative said, the company had a clear direction, which was to replace imported raw materials, which meant developing domestic dairy cows.
In 1991, the company materialized by proactively sourcing raw materials for production by building a domestic raw material area, the “milk revolution” or “white revolution” was born. By 2005, Vinamilk began the phase of building concentrated, high-tech farms with the establishment of the first farm in Tuyen Quang province.
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| Investing 1,200 billion VND and 5 years of renovation and construction, Vinamilk has turned the barren land in Ben Cau district (Tay Ninh) into a "resort" for dairy cows. |
This “white revolution” is difficult, because first of all, dairy farming is not a traditional strength of Vietnam, farmers do not have experience in dairy farming, moreover, Vietnam’s climate is not a suitable place for dairy farming (needs cool, low humidity).
But up to now, Vinamilk has had 12 farms spread across the country. In addition, according to the three-agriculture policy, close cooperation with local dairy farmers has helped increase the total number of cows from 3,000 in 1991 to 113,000 in 2015 and now 130,000, the milk productivity of Vinamilk cows is said to be not inferior to other countries in the region and the world, especially even with countries that are the homeland of the dairy farming industry.
Promoting internal strength to help change the dairy industryBuilding a dairy industry is not a simple story because investing in a dairy farm requires a large amount of capital and a long investment and renovation time. Meanwhile, risks in livestock, markets, interest rates, etc. are always constant challenges for businesses. Moreover, developing dairy farming in a tropical area, which is inherently unsuitable, makes the risks even higher.
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| Nghe An dairy farm seen from above. |
Although it is a challenging problem, but with systematic investment and proactive application of high technology, businesses are completely capable of turning those challenges into opportunities to create outstanding developments. And in fact, the development of Vinamilk has proven that although the dairy farming industry is not the strength of a tropical country like Vietnam, it can still create strong development milestones thanks to solid steps in investing and applying modern technology.
In March 2019, this company continued to introduce the dairy cow “Resort” model with a farm in Tay Ninh. It is known that this is the way this enterprise wants to set its own standards when developing farms like dairy cow resorts and help consumers trust more in the methodical investment of Vietnamese dairy enterprises.
Solving the problem of fresh milk quality according to international standardsAfter starting to build the first farm in 2005, the representative of this enterprise said that was also the time when the Vietnamese dairy industry had positive growth when the community's awareness of nutritional supplements from milk increased.
The growing dairy industry has opened up many opportunities, but at the same time it has also created challenges for businesses, as they not only need to increase output but also have to meet increasingly stringent quality standards.
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| Vinamilk received confirmation of the largest Global GAP standard farm system in Asia in terms of number of farms. |
That was also the time when Vinamilk was officially awarded the certificate of international standards of Good Agricultural Practices (Global GAP) by Control Union for the farm in Nghe An. This is also the first farm in Southeast Asia to be certified by Global GAP and is one of three farms in Asia that met the international standards of Global GAP at the time of inauguration in 2014.
This is also a turning point marking a new stage for Vinamilk's farm development strategy in applying international standards. This orientation has been truly realized when, up to now, Vinamilk is the Vietnamese dairy company that owns the largest Global GAP farm system in Asia in terms of the number of farms.Also within this strategy, the organic trend is also being embraced by this enterprise. Vinamilk has built and put into operation an organic dairy farm in Da Lat in March 2017. This is the first organic dairy farm in Vietnam to achieve European Organic standards certified by Control Union, bringing organic milk products closer to the Vietnamese people.
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| Vietnam's first Organic dairy farm in Da Lat was invested by Vinamilk with imported Organic dairy cows. |
Then, in June 2018, for the first time in Vietnam, purebred A2 dairy cows from New Zealand were imported to Vietnam in Vinamilk's dairy farm system. Just 1 month later, the first batch of milk from Vinamilk's A2 dairy cow generation was released to the market. Accordingly, pure A2 milk is produced and supplied to the market by Vinamilk in the form of pasteurized milk and sterilized milk.
Domestic consumers have the opportunity to consume fresh milk products according to international standards, at stable prices. Vietnamese dairy products also have the opportunity to access the world market, increasing exports. This will in turn help businesses have the resources to continue investing in development to bring quality products. This is the value chain that the raw material development strategy of businesses like Vinamilk is implementing brings to the dairy industry as well as the economy in general, contributing to improving the lives of farmers and the quality of nutritional products for direct consumers. |
| Purebred A2 dairy cows have been imported to Vietnam and are currently growing well at Vinamilk's High-Tech Farm Complex in Thanh Hoa. |
SOME NOTABLE MILESTONES:
1991: Pioneer in the "white revolution" to build fresh milk raw material areas.
2006: The first dairy farm was launched in Tuyen Quang
2006 - 2014: Continuously building dairy farms across the country.
2014: Nghe An Dairy Farm - The first farm in Southeast Asia to meet Global GAP standards and one of three farms in Asia to meet Global GAP international standards.
2017: Inauguration of Vietnam's first European Organic standard organic dairy farm in Da Lat.
2018: Imported purebred A2 cows and launched the first 100% A2 fresh milk product in Vietnam from pure A2 raw materials.
2019: Inauguration of Vinamilk Tay Ninh Dairy Cow "Resort", and officially confirmed to own the largest Global GAP standard Farm System in Asia in terms of number of farms.
INCREASE DAIRY HERD SCALE AND INVESTMENTGO ABROAD
In 2003, Vinamilk's dairy cow population was just over 3,000, but by 2019 it had increased to 130,000.
Currently, Vinamilk's daily milk output has reached 950-1000 tons/day. This is a record output, marking a big step forward in dairy farming activities at Vinamilk's farms.
Recently, Vinamilk has invested in building a dairy cow "resort" complex in Xieng Khouang Plateau (Laos) with a scale of 5,000 hectares and a herd of 24,000 organic dairy cows (phase 1).
Vinamilk said that this project will contribute to doubling the total herd of cows at the farm managed by Vinamilk, helping to increase the source of organic fresh milk for production and export.
