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SPECIALITY FATS
A growing number of high-end shops, restaurants and hotels is expected to contribute to the growth of the bakery sectory in Vietnam
Vietnam: bakery on the rise Vietnam’s bakery, cereal products and confectionery markets are expected to grow, with imported palm oil used as an ingredient in these sectors Muhammad Kharibi, Rina Mariati Vietnam’s bakery, cereal products and confectionery market is one of the most robust in the Asia Pacific region. According to Statista, revenue in the country’s bread and cereal products sector reached US$6,838M in 2020, surging by 34.4% from US$5,088M in 2019. In terms of volume, the sector registered 3,848M kg in 2020, an increase of 31.1% from the 2019 figure of 2,934M kg. The COVID-19 pandemic was the main reason behind the huge increase in the sector’s revenue and volume. The normal annual average growth for the segment’s revenue and volume is 3.3% and 2.5% respectively. However, during the pandemic, the Vietnamese preferred to dine at home and, due to their convenience, bakery products became a popular choice. www.ofimagazine.com
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The country’s bread and cereal products segment is expected to grow in the future, although not at the pace of 2020. The projected revenue and volume in 2021 are US$6,885M and 3,779M kg respectively.
Palm oil imports
With a population of 97.3M people, Vietnam’s consumption of oils and fats stood at 1.6M tonnes in 2020, a rise of 8.6% or 130,000 tonnes compared with 2019. The country is one of the most important markets for palm oil in the Association of Southeast Asian Nations (ASEAN) region and palm is the main oil consumed in Vietnam, with a share of 61.2% or 976,000 tonnes out of the country’s total oils and fats consumption last year. The demand for palm oil is expected to show an upward trend in the future with the food industry and the hotel, restaurant and catering (HORECA) sector representing major consumers. The bakery and confectionery sector is one area of the food industry which offers growth potential for palm oil. Most of the finished palm products imported by Vietnam are used in the bakery and confectionery sectors (see Table 2, following page). The country imports palm oil from both Indonesia and Malaysia, with imports
recording strong growth in the past five years at an average annual growth of 7.3%. In 2020, Vietnam imported 1.04M tonnes of palm oil, a 9.4% or 89,000 tonnes increase compared with 2019. The country is the second largest importer of Malaysian palm oil in the ASEAN region after the Philippines. However, Malaysian palm oil imports into Vietnam registered a decline of 158,427 tonnes or 26.61% in 2020, mainly due to an increase in imports from Indonesia and a high volume of soyabean coming from the USA. Competitive pricing led to Vietnam increasing its Indonesian palm oil imports in 2020 by 259,000 tonnes or 75.7% compared to 2019. Last year, the country’s soyabean imports also rose as its pig herd began to recover from the 2019 African swine fever (ASF) outbreak, leading to increased demand for feed. According to Oil World data, US soyabean exports to Vietnam rose by 330,200 tonnes or 58.42% to total 895,400 tonnes for the January to November 2020 period, compared with the same period in 2019. The surge in domestic crushing also led to increased availability of soyabean oil for local consumption, translating into slower u imports of palm oil into Vietnam. OFI – SEPTEMBER/OCTOBER 2021
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