StoxPlus is pleased to introduce Vietnam Food Processing Market 2016 Report, the first issue on this industry. This report presents a board range of topics, both sector-specific and cross-cutting market issues.

We have completed the review of food processing landscape in Vietnam, including the market overview, analysis of demand, supply, distribution, value chain and competitive landscape of each segments, investment activities and legal framework.

Below are the most critical findings in our first issue:

1.       Total industry is valued at 4 US$bn. Food processing industry can be segmented into 4 sections – processed seafood, processed meat, Milk products and processed fruit & vegetables. Processed seafood and Milk products are the biggest segments.

2.       Growth of processed seafood sale depended heavily on sale of export processed seafood. Therefore, export companies receive favourable support from the government. Total sales of export processed seafood picked up during 2010-2014 with CAGR of 13% but fell in 2015 because of numerous reasons including depreciation of the Japanese Yen and European Euro, pressure of anti-dumping laws from the US, …

Domestic production of processed seafood was equivalent to 40% of total seafood production, increasing steadily at 2-3% annual since 2011. Currently, factories are not operating efficiently at designed capacity due to the lack of raw ingredient supply.

3.       Vietnam domestic meat market continues to grow in 2015. Even though domestic market of processed meat is still at a fairly undeveloped stage, it has still attracted many big players, especially foreign investors. This segment also witnessed the largest value of M&A deals in 2015 compared to other segments.

Sausage has become the hottest category because of its high profitability and preference of Vietnamese consumer. In 2014, although revenues earned from sausages only accounted for 25.4 per cent of VISSAN’s total revenue, the profit recorded by the sales of this product accounted for more than 60 per cent of the company’s profit.

4.       Domestic production of milk has doubled in the last 5 years as of 2015. Big players like Vinamilk, Nutifood are still expanding or building new factories to increase milk supply. However, this only met 30% of total domestic demand. Therefore, import market of milk still has a lot of opportunity for growth.

Milk products is the largest segment in the food processing industry, followed by yogurt with five year CAGR of 13% and 12% respectively. According to MOIT, per capita milk consumption in Vietnam was just 18 liters per annum in 2013 and was expected to rise to 21 liters by 2015 and 35 liters by 2025. Therefore, milk products market will continue to grow strong in the future.

5.       Domestic processed Fruit & Vegetables market in Vietnam is at a fairly underdeveloped stage. The segment has not experienced much growth with only 12% annual on average in the last 5 years.

Domestic production of processed fruit & vegetables depends on the growth of export market with most producers concentrating in the South as supply is more abundant in this region.

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