Vietnam's dairy industry is embarking on a trajectory marked by both ambition and a focus on sustainability. The sector seeks to address the increasingly intertwined issues of rising domestic milk demand and the need for global competitiveness.

This strategic direction was emphasized by Tran Quang Trung, Chairman of the Vietnam Dairy Association. He spoke at the launch of the 4th Vietnam International Milk and Dairy Products Exhibition (Vietnam Dairy 2024), a key industry gathering.

Mr. Trung highlighted a concerted effort towards modernizing the entire value chain, from the production of raw milk to the creation of consumer-ready products. A cornerstone of this modernization lies in the adoption of "green production" solutions.

These include initiatives like achieving net-zero emissions on farms, transitioning to renewable energy sources, and engaging in large-scale tree planting projects.

This shift reflects not just an environmental imperative but a savvy business strategy, positioning the Vietnamese dairy industry in alignment with global consumer preferences for sustainable and ethical food systems.

The industry's dedication is backed by a commitment to delivering high-quality products. "Dairy businesses have always mobilized constant efforts with the world to launch high-quality products when supplied to the market to consumers," Mr. Trung stated.

"The products have conquered world standards and markets." It's a testament to the sector's ambition to become a player not just domestically, but internationally as well.

This focus on quality and sustainability has fueled growth. The Vietnam Dairy Association reports a healthy increase in the dairy market's revenue, reaching approximately $5 billion in 2022 and projected to rise to $5.03 billion in 2023. This growth has occurred in the face of lingering pandemic-related economic difficulties and wider geopolitical uncertainties.

While the outlook is positive, Vietnam still has room to expand its domestic milk consumption. Associate Professor Le Bach Mai, former Deputy Director of the National Institute of Nutrition, points out that at present, Vietnamese per capita milk consumption lags behind regional and global averages.

With an annual consumption rate of 26-28 liters per person, it sits below Thailand (35 liters), Singapore (45 liters), and significantly lower than European nations where consumption can approach 80-100 liters per person annually.

This represents a substantial untapped market and a compelling argument for the dairy industry's continued expansion. As Ms. Mai notes, "The dairy market in Vietnam has been diverse in types...milk plays a vital role in addressing malnutrition and stunting amongst Vietnamese children, issues that remain prevalent. Therefore, milk consumption will continue to increase in the next few years."

Opportunity for Expansion and Partnerships

The Vietnam Dairy 2024 exhibition, slated for May 30 to June 2 in Ho Chi Minh City, positions itself as a crucial catalyst for the industry's anticipated growth. The event offers a space for domestic and international businesses to network, forge partnerships, and drive the sector forward.

Nearly 200 booths will showcase businesses from diverse nations, including Australia, Denmark, Taiwan, New Zealand, Japan, the US, South Korea, Switzerland, France, as well as leading Vietnamese enterprises. This international dimension highlights Vietnam's intention to not just serve its own population but to become an integral part of global dairy networks.

"The exhibition will contribute to strengthening investment cooperation, trade exchange, science and technology, improving competitiveness towards sustainable development for Vietnam's dairy industry," Mr. Trung remarked.

Implicit in his statement is an acknowledgment that domestic innovation alone cannot propel the industry. Strategic partnerships with international players will be crucial for acquiring cutting-edge technology and expertise.

Additionally, the exhibition aims to educate consumers and promote public health. This focus is key, as a more informed populace is a more likely candidate for increased milk consumption, fueling the industry's domestic growth.

Finally, this year's emphasis on "green production" puts sustainability at the forefront of the dairy sector's agenda, signifying a shift that is as much about ethical business practices as it is about securing future growth amidst increasing consumer demand for eco-conscious products.