April 19, 2024 | 09:15 GMT+7

Vietnam's Dairy Market: Bridging the Gap for Growth and Innovation

Leon Pheek -

With domestically produced milk meeting only 40% of demand, Vietnam's dairy industry sees untapped potential.

Mr. Tran Quang Trung, Chairman of Vietnam Dairy Association at the conference.
Mr. Tran Quang Trung, Chairman of Vietnam Dairy Association at the conference.

Chairman of the Vietnam Dairy Association Mr. Tran Quang Trung emphasized the imperative of developing milk raw material areas and cultivating a distinct brand identity for Vietnamese milk in a recent conference.

"Vietnam's dairy industry has received attention from the State and businesses," he noted, highlighting the proactive investments made in technology and the establishment of modern factories.

Still Plenty of Room for Growth

However, Mr. Trung said despite the support and efforts, domestic production of raw milk only meets 40% of the nation's demand, with per capita consumption lagging behind neighboring countries like Thailand and Singapore.

Statistical data reveals that Vietnam's per capita milk consumption remains comparatively low, ranging from 26 to 28 liters per person per year.

In contrast, Thailand's consumption stands at 35 liters per person per year, while Singapore exceeds with 45 liters. European countries lead the pack, boasting consumption rates ranging from 80 to 100 liters per person annually.

Moreover, Mr. Tran Quang Trung highlighted that milk consumption is projected to rise in the coming years, driven by heightened awareness of nutrition and immunity, alongside advancements in modern sales channels.

This glaring gap underscores the substantial growth potential within the market. Industry experts forecast a promising trajectory, estimating a Compound Annual Growth Rate (CAGR) of 6.47% from 2023 to 2028, fueled by Vietnam's burgeoning population, particularly among children.

Vietnam's dairy market, anchored by liquid milk and powdered milk, constitutes over 70% of its revenue structure. Despite facing challenges such as the global pandemic and geopolitical tensions, the industry has demonstrated remarkable resilience.

In 2023, Vietnam's General Statistics Office reported a surge in fresh milk output to 1.86 billion liters, representing a robust 7.5% increase from the previous year. Powdered milk production also experienced a modest uptick, reaching 154,800 tons.

Innovations Reshaping Vietnam's Dairy Landscape

Amidst the lush expanses of Vietnam, a dairy transformation is underway, fueled by a wave of investment and innovation. With over 1,700 dairy farms and nearly 28,700 dedicated households, the sector is undergoing remarkable changes.

Investments in cutting-edge technology and modernization initiatives are bearing fruit, as farms embrace high-tech agricultural practices and embark on large-scale operations.

The relentless pursuit of progress sees businesses forging strategic partnerships with cow-raising households, laying the groundwork for enhanced raw milk production.

Noteworthy is the industry's unwavering commitment to sustainability, epitomized by its embrace of regenerative agriculture and clean energy solutions.

Leading the charge are trailblazers like Vinamilk and TH Milk, who have unveiled state-of-the-art dairy farms adhering to stringent Global GAP standards. These futuristic facilities boast advanced technology and automation, seamlessly orchestrating a closed-loop system from verdant pastures to state-of-the-art production facilities.

As Vietnam's dairy market stands at the nexus of opportunity and challenge, it embarks on a journey of sustained growth. Armed with strategic foresight and a growing commitment to excellence, the industry is poised to contribute to the country's economic prosperity while catering to the evolving nutritional needs of Vietnamese consumers.

The original article is written and published on VnEconomy in Vietnamese only. To read the full article, please use the Google Translate tool below to translate the content into your preferred language.
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