Hoa Phat, Dabaco, Masan MEATLife all grow well
In the first nine months of this year, most pig farming businesses recorded good growth thanks to high and stable pork prices over a long period of time.
For example, in the first 6 months of the year, Hoa Phat Livestock Development Joint Stock Company sold nearly 190,000 pigs, 80,000 commercial pigs and more than 1,000 gilts. Sales of all pig lines grew well. As a result, Hoa Phat's livestock revenue increased by 34.4% compared to the same period last year.
Dabaco Vietnam Group Joint Stock Company (Code: DBC) said that the group's revenue in August exceeded VND2,024 billion, up 11% compared to July. Revenue in July and August increased by 12% compared to the previous two months and increased by 33% compared to the same period in 2023. In particular, the animal feed and pig farming sectors were the main factors contributing to the growth.
Mr. Nguyen Nhu So - Chairman of the Board of Directors of Dabaco Group commented: Dabaco's abundant pork inventory at this time is expected to become one of the levers to help the Group improve business results in the last months of the year.
Another bright spot in the livestock sector is Masan MEATLife (Code: MML). In June, Masan MEATLife recorded positive operating profit (EBIT) for the second consecutive quarter. Specifically: According to the financial report for the second quarter of 2024, Masan MEATLife recorded an increase of VND 105 billion in operating profit (EBIT) over the same period. This is the second consecutive quarter that MML has achieved positive EBIT. Positively contributing to this result is the increase in revenue from the processed meat segment thanks to advantages such as increased prices of chicken and pork and reduced animal feed costs.
MML continues to contribute to the transformation and development of Vietnam's processed meat industry with high-quality products under two brands, Ponnie and Heo Cao Boi. According to Masan MEATLife, these two brands have achieved approximately 50% market share in the sterilized sausage product market.
Some pig farming enterprises have announced preliminary business performance in the third quarter with clear differentiation. Photo: Dabaco
In contrast to Hoa Phat Livestock, Dabaco, Masan MEATLife, Dong Nai Agricultural and Livestock Products JSC (Dolico - Code: NSS) estimates that in the first 9 months of this year, the company's pork consumption output only reached 1,840 tons, revenue of about 95 billion VND, pre-tax loss of 1.7 billion VND.
This year, Dolico aims to achieve pre-tax profit of VND5.8 billion. With the above estimated results, this livestock company is still far from its plan. To increase revenue in the coming time, Dolico said it will have to lease warehouses, houses and shop premises at the main office in Bien Hoa city (Dong Nai) and many other locations of the company. In addition, the company must also reduce the remuneration of the Board of Directors by 20% and the remuneration of the Board of Supervisors by 10% from October 2024.
In the last months of 2024, NSS said that each month it will try to import 1,000 3-blood piglets for meat to increase income and revenue. At the same time, each month it will import 100 gilts as breeding sows. The amount of each piglet import is from 2-3 billion VND to serve production for Suoi Cao and Xuan Thanh farms.
Previously, Dolico estimated its production and business plan for the third quarter of 2024 with a pork consumption output of 135 tons, total revenue of more than 8 billion VND and after-tax profit of 500 million VND.
Although it was expected to be like that, this enterprise said that the company's livestock business is facing many difficulties, diseases in livestock are becoming more and more complicated, causing the price of raw materials for animal feed production to increase, the materials and equipment for production to increase accordingly, and the cost of veterinary medicine to prevent diseases in livestock is also higher than before.
Hoang Anh Gia Lai Joint Stock Company (HAGL - Code: HAG) is still struggling. In the second quarter, the pig farming segment only brought in VND320 billion in revenue for HAG, down 28% year-on-year. Gross profit improved, reaching VND86 billion, up 56% year-on-year. In the first 6 months of the year, HAGL's pig farming segment recorded VND612 billion in revenue, completing 39% of the yearly plan and VND92 billion in gross profit. HAGL did not explain in detail the cost of sales, management costs and other related costs, so it is not possible to determine the net profit/loss.
This year, HAG sets a revenue target of VND 7,750 billion, an increase of 20.2% compared to 2023. Of which, revenue from banana-fed pigs is VND 1,550 billion. Although livestock farming activities have not yet contributed much to HAG's main revenue, LPBank has signed a contract to provide a credit of VND 5,000 billion to HAG, of which VND 3,000 billion will be disbursed in the first phase to support HAG in promoting investment in new planting and pig farming. HAG has invested in increasing the herd again, facilities and barns are available, and it is expected that products will be available in 4-5 months. This means that by the fourth quarter of 2024 and 2025, HAG can make a profit.
Opportunity to improve profit margins of livestock enterprises at the end of the year
VPS Securities Joint Stock Company recently forecasted that pork prices are expected to remain high in the long term due to supply shortages and natural disasters such as storms and floods in the North and Central regions. It will take at least until the end of 2024 for new supply to reach the market. Not to mention the period near Lunar New Year, when pork prices often increase due to high demand. Therefore, it is likely that pork prices will remain high at around 65,000 - 70,000 VND/kg. When pork prices remain high, businesses producing and trading pork products will have the opportunity to improve profit margins in the last months of 2024.
The Analysis Center of Tien Phong Securities Joint Stock Company also commented that pork prices tend to increase due to greater demand in the context of the supply not being able to rebuild herds in time after the African swine fever (ASF) epidemic. Currently, many businesses and small-scale farmers are in the process of rebuilding their herds after the ASF epidemic and it will take at least until December 2024 for new supply to be available on the market.
According to experts from Maybank IBG Research, pig prices may continue to increase in the coming time. In the short term, pig prices may be supported by reduced supply due to losses of small-scale producers and disease outbreaks.
As pork prices remain high, businesses producing and trading pork products will have the opportunity to improve profit margins in the last months of 2024.
Regarding pork supply, the Department of Livestock Production (Ministry of Agriculture and Rural Development) said that from now until the end of the year - including during Tet when pork demand increases by about 10-15%, we will still ensure a good supply from domestic pork production. However, it is necessary to prevent African swine fever and ensure biosecurity in livestock production.
The Ministry of Agriculture and Rural Development has recommended that 16 large pig farming enterprises nationwide expand their production scale to ensure supply. As for farming households, when entering or increasing their herds, they must ensure safe, disease-free and quality breeding sources, and strictly ensure biosecurity to maintain the herd.
The Ministry of Agriculture and Rural Development forecasts that the supply of pigs will increase again in the coming time. However, due to the complicated epidemic situation, the price of live pigs may remain high and only decrease again in 2025.
Source: https://danviet.vn/cac-ong-lon-chan-nuoi-dang-lam-an-the-nao-diem-danh-hoa-phat-dabaco-hagl-20240922172625474.htm
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