Báo cáo khoa học nông nghiệp " SMALL-MEDIUM ENTERPRISES IN THE LIVESTOCK FEED SECTOR IN VIETNAM ( VOLUME I )" potx

INSTITUTE OF POLICY AND STRATEGY FOR AGRICULTURE AND RURAL DEVELOPMENT
CENTER FOR AGRICULTURAL POLICY

CARD Project 030/06 VIE: Developing a strategy for enhancing the
competitiveness of rural small and medium enterprises in the agro-food
chain: the case of animal feed

SMALL-MEDIUM ENTERPRISES IN THE
LIVESTOCK FEED SECTOR IN VIETNAM
VOLUME I: Livestock feed production
Pham Thi Lien Phuong
1
, Nguyen Thi Thinh
1
, Donna Brennan
2
, Sally Marsh
2
, Bui
Hai Nguyen
1

1
Center for Agricultural Policy, Institute of Policy and Strategy for Agriculture and Rural
Development, Hanoi
2
School of Agricultural and Resource Economics, University of Western Australia

Hanoi, April 2010

i
EXECUTIVE SUMMARY
The origin of this study goes back to previous research on the livestock feed sector in
Vietnam that has shown high costs and low productivity in the overall sector. However,
no previous study has looked at the differences between mills of different production
scale, mills by region and ownership types. Therefore, previous solutions to enhance the
competitiveness of feed mills, especially small and medium enterprises, are usually
generalised rather then specified for each type of mill. This study has focused on specific
mill types in the Vietnamese livestock feed sector with a particular focus on small and
medium enterprises (SMEs) in different regions.
This report provides a current overview of the Vietnamese livestock feed production
sector. Besides outlining the environment and infrastructure within which feed mills are
working, an important part of the report was to provide information on how feed mills
operate along their supply chain, describing relationships with their material suppliers and
output customers. Data was collected during mid-2008 using a survey of 62 feed mills
situated throughout the country. Information collected included that concerning the
production and business activities of the different sized feed mills, their distribution
channels, and their technology levels.
The focus of this report is on comparing SMEs and large enterprises with regards to the
production and business activities of enterprises such as material input use, storage,
product types, quality control, and type of customer. These activities give indications of
how SMEs compete with larger feed mill enterprises. The mills have been categorised in

the following way in the analyses: small mills are those producing less than 10,000 tonnes
per annum; medium mills are those producing from 10,000 to less than 60,000 tonnes per
annum, and large mills are those producing 60,000 or more tonnes per annum.
In this study we have explored aspects of competitiveness in the feed mill sector.
Competitiveness in the sector is likely to involve more than cost efficiencies as a result of
economies of scale. Competitiveness in the sector is also associated with quality aspects
of feed (and perceptions of quality), services provided along with the sale of feed, and
procurement and distribution channels used by the mills.
We found statistical evidence in this study that cost of production was inversely related to
scale, with small enterprises having significantly higher costs of production per kg of
output than medium enterprises which had higher costs of production than large
enterprises. This alone is not necessarily an indicator of greater inefficiency of SMEs. For
example, we found that SMEs were more focused on production of concentrate than
larger mills. Concentrate production has higher raw material input costs per kg of output,
so cost of production per kg of total output would necessarily be higher for those
producing more concentrate.
We found no statistical evidence to indicate that small enterprises paid more for the key
raw material inputs used in production of feed. Analyses of prices paid by location also
indicated that there were no significant differences between the northern and the southern
regions of Vietnam. Our findings indicated that raw material costs made up about 80% of
the total cost of production in feedmills. An analysis of costs other than raw material costs
showed that large mills had significantly lower unit costs than small mills. We also found
other indicators, outlined in detail in the report, to suggest that the lower cost of
production experienced by large feedmills may reflect greater efficiency.


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Our data indicate that small mills (producing less than 10,000 tonnes per annum) are
likely to struggle to remain competitive. The data indicate that they face significantly
higher costs, and sell some feeds at significantly lower prices, resulting on average in a

significantly lower profit. Anecdotally, this is supported by reports of small mills ceasing
business, and our observations when conducting the survey of many previously listed
small mills no longer in business. However, our results support the idea that medium-size
mills (producing between 10,000 and 60,000 tonnes per annum) are remaining
competitive, and have costs and product mix and prices similar to large mills.
Our results show that the supply/distribution chains operating for SMEs and large firms in
the livestock feed sector are quite different. SMEs source their raw materials and
distribute their products differently to large feedmills. They deal more with small
householders and traders both for the procurement of raw materials and in the distribution
of their products. Large mills are more dependent on imports (e.g. maize) to meet their
raw material requirements, whereas SMEs are more likely to be able to source sufficient
domestic supplies. It is likely that small-medium feedmills do provide more direct support
to other small-medium enterprises operating in the livestock sector.
Quality control operates at a lower level in domestic mills compared to foreign-owned
mills and mills operated by joint venture partners, although protein content (as nominated
on the feed label) was not statistically lower in feeds produced by domestic mills
compared to foreign mills. However, the fact that advanced international standards for
quality control such as ISO and HACCP are only applied by foreign-owned and joint
venture companies, indicates better quality control processes for both raw materials and
output products from foreign/large companies. These mills are also more likely than
domestic enterprises to have a quality control laboratory, to have separate production
lines, to own automatic cleaning systems and to use least-cost feed ration software.
Based on the findings of this study we make the following policy recommendations for
policy makers:
• Focus is needed on quality control. If long term food safety and export potential is
to be reached, the Government of Vietnam needs to address quality control issues
associated with the production of livestock feed products.
• Restrictions on the movement of goods due to irregular police conduct need to be
addressed.
• Invest in domestic production of raw materials used in feed production.

• Credit support for SMEs in the sector should be expanded.
• Support and expand the role of the Vietnamese Animal Feed Association (VAFA).
• Investigate the possible ways the government may provide price support for raw
materials and livestock feed outputs.
We suggest the following recommendations for SMEs operating in the sector:
• Small mills need to increase their scale of operation.
• Quality control standards need to be raised.
• Continue to explore and exploit niche market opportunities.
• Consider advantages from diversification and/or a cooperative structure.
• Support a strong role for the VAFA.

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ACKNOWLEDGEMENTS
The authors gratefully acknowledge funding for this research work from AusAID’s
CARD Program for Project 030/06 VIE: Developing a strategy for enhancing the
competitiveness of rural small and medium enterprises in the agro-food chain: the case of
animal feed.
The authors acknowledge contributions made to the research work from CAP staff other
than the listed authors, including: Pham Tuyet Mai, Tran Cong Thang, Nguyen Ngoc
Que, Nguyen Do Anh Tuan, Nguyen Anh Phong and Nguyen Le Hoa.
The authors also acknowledge helpful discussions with Mr Le Van Lich (VAFA), Mr
Tran Cong Xuan (VPA), Ms Bui Thi Oanh (MARD) and Mr La Van Kinh (South VAAS)
as well as participants in the two stakeholder workshops held in December 2009 in Hanoi
and January 2010 in HCMC. Advice on technical issues was received from the
Vietnamese experts mentioned above, and also from Dr. Johanna Pluske (livestock
economics consultant) and Professor John Pluske (animal nutritionist from Murdoch
University in Western Australia.)
Feedback on draft versions of this report was provided by Dr Johanna Pluske and we
highly appreciate her useful and critical comments.
Finally, we acknowledge and thank feed mill survey participants for their willingness to

support the survey work and give details associated with their businesses.

LIST OF ABBREVIATIONS
ANOVA Analysis of Variance
ASEAN Association of South East Asian Nations
CAP Center for Agricultural Policy
CARD Collaboration for Agriculture and Rural Development
CP Charoen Pokphand
DLP Department of Livestock Production
FAO Food and Agriculture Organization
GDP Gross Domestic Product
GMP Good Management Practice
HACCP Hazard Analysis Critical Control Points
ISO International Organization for Standardization
MARD Ministry of Agriculture and Rural Development
MCP Mono Calcium Phosphate
NSD No Significant Difference
SD Standard Deviation
SME Small Medium Enterprise
SOE State Owned Enterprise
VAFA Vietnamese Animal Feed Association
VAT Value Added Tax
VBARD Vietnamese Bank for Agriculture and Rural Development
VND Vietnamese Dong

iv
TABLE OF CONTENTS

EXECUTIVE SUMMARY i
LIST OF FIGURES

vi
LIST OF TABLES
vii
1 INTRODUCTION 9
1.1 Background 9
1.1.1 The livestock sector in Vietnam 9
1.1.2 Small medium enterprises (SMEs) in Vietnam 9
1.1.3 SMEs in the livestock feed sector in Vietnam 10
1.2 Objectives 10
1.3 Research questions 11
1.4 Methodology 11
1.4.1 Background research 11
1.4.2 Survey design and sites 12
1.4.3 Sampling design 12
1.4.4 Data collection and processing 13
1.5 Limitations and structure of the report 15
1.5.1 Limitations 15
1.5.2 Structure 15
2 RECENT CHANGES IN THE VIETNAMESE FEED INDUSTRY 16
3 BACKGROUND INFORMATION ON FEED ENTERPRISES IN VIETNAM 21
3.1 General characteristics 21
3.2 Labor use and wages 22
3.3 Infrastructure 25
4 COST STRUCTURE AND RAW MATERIAL USE 28
4.1 Cost structure of feed enterprises 28
4.2 Procurement of raw materials 29
4.2.1 Prices paid for raw materials and percentage of raw material from different
sources 29
4.2.2 Providers of raw materials 33
4.2.3 Payment method for input purchase 34

5 FACTORY OUTPUT 36
5.1 Output types 36
5.2 Profit 39
5.3 Market share and competition 40
5.4 Nutrient content and additives use 40
6 SUPPLY CHAIN 42
6.1 Distribution channels – transportation distances 42
6.2 Distribution channels - type of customer 42
6.3 Overview of input supply and output distribution channels for different
scale enterprises 45
6.3.1 Supply sources and distribution channels for large feed mills 45
6.3.2 Supply sources and distribution channels for medium feed mills 46
6.3.3 Supply sources and distribution channels for small feed mills 47
6.3.4 Summary of input supply and distribution channels 47
6.4 Payment methods 48
6.4.1 Payment methods for complete feed 48
6.4.2 Payment methods for concentrate feed 49
6.5 Services 50

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6.5.1 Services to agents 50
6.5.2 Service to livestock producers 51
6.6 Determination of livestock feed prices 52
6.6.1 Setting of feed prices 52
6.6.2 Commission rates 53
6.6.3 Selling price changes made by enterprises during 2007 54
6.7 Product quality control 56
6.7.1 Certification and testing 56
6.7.2 Processing method 58
6.7.3 Product formulation 59

6.7.4 Post-production and storage 59
6.8 Location, information sources and restrictions on the movement of
goods 62
6.8.1 Location of firms 62
6.8.2 Restrictions faced by mills on the movement of goods 63
6.8.3 Sources of information for feed mill enterprises 64
7 OTHER ISSUES 66
7.1 Credit 66
7.2 Profitability and investment 67
7.3 Issues, opportunities and constraints 69
8 SUMMARY OF KEY FINDINGS AND IMPLICATIONS FOR POLICY 72
8.1 Main findings 72
8.1.1 Costs of production 72
8.1.2 Revenue and production activities 73
8.1.3 Profitability 74
8.1.4 Procurement (and storage) of raw material inputs 74
8.1.5 Distribution of livestock feed products 75
8.1.6 Quality control 75
8.1.7 Services to clients 76
8.1.8 Constraints on production 76
8.1.9 Opportunities 77
8.2 Evidence of returns to scale 77
8.3 Strategies currently being used by SMEs to compete in the livestock
feed sector 78
8.3.1 Location 78
8.3.2 Product mix 78
8.3.3 Commission rate on concentrate feed 79
8.3.4 Discounted prices 79
8.3.5 Supply chain differences 79
8.3.6 Payment in advance for inputs and provision of credit for output sales 79

8.3.7 Services provided to agents and farm households 80
8.4 Role played by SMEs in the livestock feed sector 80
8.5 Policy recommendations 80
8.5.1 For policy makers 80
8.5.2 For SMEs 82
APPENDIX 84
REFERENCES 88




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LIST OF FIGURES
Figure 1. Number of feed enterprises, total industrial feed production (plus premix) vs.
capacity by region in 2006 17
Figure 2. Vietnam’s import value of animal feed and inputs for feed processing, 2001 -
2008 19
Figure 3. Prices of some raw feed inputs in Vietnam during 2007-2008 20
Figure 4. Prices of raw materials and pig complete feed for Proconco company in 2007 20
Figure 5. Distribution of feed enterprises by production scale in north and south Vietnam
(%) 21
Figure 6. Labor size of feed enterprises by foreign and domestic ownership 23
Figure 7. Labor size of feed enterprises by production scale 24
Figure 8. Average salary for labor of feed enterprises by production scale 24
Figure 9. Raw material purchase costs per ton of output, by ownership type and
production scale 29
Figure 10. Composition of energy rich ingredients as percentage of total energy inputs
used 30
Figure 11. Composition of protein rich ingredients as a percentage of total protein inputs
used 30

Figure 12. Inputs used to produce one tonne of feed output by production scale 33
Figure 13. Payment methods used for raw material purchases, by production scale 35
Figure 14. Percentage of firms paying VAT for raw material inputs, by production scale
35
Figure 15. Percentage of firms producing complete and concentrate feed 37
Figure 16. Supply sources and distribution channels for large feedmills in Vietnam 45
Figure 17. Supply sources and distribution channels for medium feedmills in Vietnam 46
Figure 18. Supply sources and distribution channels for small feedmills in Vietnam 47
Figure 19. Percentage of feed mills and retail agents fixing the selling price, by
production scale 53
Figure 20. Commission on factory gate prices obtained by agents (wholesale and retail
agents combined), for product from small, medium and large mills 54
Figure 21. Percentage change in the factory gate price of the main product during the
quarters 2, 3 and 4 and the total change in 2006/2007, by production scale 55
Figure 22. Laboratories used for testing raw materials and products by foreign and
domestic mills and by large, medium and small mills 57
Figure 23. Methods used by mills for cleaning between product batches 59
Figure 24. Total days and percentage of the storage time of the main product by mills,
agents and others by production scale 61
Figure 25. Percentage of main product reaching expiry date 61
Figure 26. Percentage of feed enterprises by production size nominating various
characteristics about factory location 62
Figure 27. Percentage of feed enterprises indicating the most important restrictions
affecting the movement of goods 63
Figure 28. Reasons given by firms for not being able to obtain more funds 66
Figure 29. Feed sectors expected by feed mill enterprises to experience the greatest future
growth, by scale of enterprise 69
Figure 30. Percentage of feed mill enterprises that said that government should provide
support in the following areas, by enterprise scale 71

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LIST OF TABLES
Table 1. The number of enterprises listed as available for the survey, the number of
enterprises surveyed in the project and the percentage of enterprises in each province
surveyed with respect to the project total 13
Table 2. For each ownership category: the total number of mills in the original sample;
the number in each classification and total number providing consistent information
for data analysis; and the percentage of the original sample that provided consistent
information 14
Table 3 . Industrial feed production in Vietnam during the period 2000 – 2008 16
Table 4. Domestic production of the main inputs for feed production and estimated
demand for feed input (1000 tonnes) 18
Table 5. Quantity of imported feed inputs to Vietnam in 2006 (‘000t) 18
Table 6. Actual and designed output of feed mills, and percent utilization of designed
output in 2007, by scale and region 22
Table 7. Average revenue from activities of feed enterprises in 2007 22
Table 8. Land area owned/leased and percentage of land being used by the feed
enterprises, by scale and region 25
Table 9. Distribution of enterprises owning or renting land and location (percent) 26
Table 10. Percentage of enterprises having storage equipment, by scale and region 26
Table 11. Average capacity (tonnes) of storage facilities 26
Table 12. Period, volume and place of material storage of feed enterprises by region and
scale 27
Table 13. Cost of production (‘000 VND per kg output) and share of total cost % 28
Table 14. Comparison of raw material input prices by scale, source and location 31
Table 15. Percentage of raw material purchases from different sources by production
scale 32
Table 16. Percentage of raw material inputs purchased from different suppliers for each
production scale of feed enterprises 34

Table 17. Percentage of firms producing each type of animal feed, by production scale
and region 36
Table 18. Percentage of firms producing complete and concentrate feed for livestock
types 38
Table 19. ANOVA analysis of pig and chicken feed prices (‘000VND per kg): mean,
standard deviation and price difference by region and production scale 38
Table 20. Profit (million VND) by production scale 39
Table 21. Cost and profit for firms grouped according to relative importance of
concentrate production 40
Table 22. Protein content of main products and share of firms using additives, by
ownership type 41
Table 23. Average transportation distances by region and production scale 43
Table 24. Amount and share of complete feed sold to different customer types by small,
medium and large feed mill enterprises 43
Table 25. Amount and share of concentrate feed sold to different customer types by small,
medium and large feed mill enterprises 44
Table 26. Payment methods used by purchasers of complete feed from enterprises by
different scale 49
Table 27. Payment methods used by purchasers of concentrate feed from enterprises by
different scale 50
Table 28. Percentage of feedmill companies providing different service to agents 51

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Table 29. Percentage of feedmill companies providing different services to livestock
producers 52
Table 30. Percentage of feed enterprises fixing the selling price for wholesale agents/
traders, by production scale 52
Table 31. Main reasons for price change of feed products (percentage of foreign,
domestic and total mills) 55
Table 32. Percentage of firms having formal certification status 56

Table 33. Percentage of mills with quality control laboratories and percentage of testing
done in those laboratories 57
Table 34. Percentage of firms that complete various tests of raw feed materials and
products 58
Table 35. Expiry period (days) nominated by mills for products, by region 60
Table 36. Mean rating of importance of location characteristics 63
Table 37. Most important information sources for feed enterprises, by scale 65
Table 38. Credit information of enterprises by scale 66
Table 39. Percentage of all loans by sources, average loan amount and length of loan, by
scale of enterprise 67
Table 40. Percentage of loans for feed/raw materials, buildings/equipment and other
purposes from various loan sources, by scale of enterprise 68
Table 41. Main reasons nominated by feed mills for change in profit in 2007 and 2005 .68
Table 42. Expectations of feed mill enterprises of the domestic supply for raw material in
the future, by enterprise scale 70






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1
INTRODUCTION
1.1 Background
1.1.1 The livestock sector in Vietnam
Global livestock feed prices have generally been rising and this trend seems likely to
continue into the future. This increase is due to two main reasons: firstly, a higher demand
for livestock feed results from a higher demand for meat and related products; and
secondly, an increasing demand for maize and other raw materials for making biofuel

products competes with the use of these raw materials for livestock feed (Pluske, 2007).
In Vietnam, the livestock industry has played an increasing role in total agricultural GDP,
with its share ranging from 22.6 to 25.5% annually during the period 2001 to 2007, and
estimated to increase to between 25 and 26% in 2008 (Livestock Department, 2008). The
livestock industry has grown quickly and spontaneously, and a lack of regulation has led
to a number of problems: there are many small and dispersed producers who have
problems of low yield, exacerbated by disease outbreaks; and a rapidly growing
commercial scale sector with little environmental oversight. Further, feed costs contribute
to about 75% of the total production costs of livestock-producing households.
In recent times, one of the hottest issues facing the livestock industry has been the
increasing trend of feed prices. The large dependence on imports of raw material
ingredients such as soybean and maize, high import taxes, and low domestic yield of
these inputs have been considered as the causes of the high livestock feed prices.
Industrial feed prices in Vietnam are around 10-15% higher than other countries in the
region, such as Thailand and China. It is estimated that Vietnam imports about 20-30% by
volume of raw materials used for livestock feed production, which accounts for 45% of
the total value of raw ingredients (www.mard.gov.vn). High livestock feed prices directly
affect producers as they result in higher production costs, especially when the prices of
livestock products can not increase sufficiently to cover the increased costs.
1.1.2 Small medium enterprises (SMEs)
1
in Vietnam
Showing impressive internal strength, the number of Vietnamese enterprises has grown
by fifteen times in the past nine years (1999-2008) (Online policy dialogue of
development pathway of Vietnamese SMEs, 2010). Accounting for 97% of more than
400 thousand enterprises operating in Vietnam's economy, small and medium enterprises
are recognized as a driving force for the development of Vietnam over time.
However, SMEs have not contributed as much as expected, due to the recent economic
crisis and global recession as well as inherent shortcomings in the business environment
in Vietnam and the internal weakness of many SMEs.

Difficulties such as lack of capital, difficult access to land for business premises, outdated
technology, weak competitiveness, the level of corporate governance restrictions and
difficulties in obtaining market access have been considered as main obstacles for SMEs.
The Vietnamese Government has recently announced a series of policies on
macroeconomic stability, including capital injection and removal of administrative


1
SMEs are independent production and business establishments, which make business registration
according to the current law provisions, each with registered capital not exceeding VND 10 billion or
annual labor not exceeding 300 people. On the basis of the concrete socio-economic situation of each
branch or locality, in the course of implementing the support measures and programs, both or either of the
above-mentioned criteria on capital and labor may be applied in a flexible manner (Article 3, Government
Decree 90/2001/ND-CP, dated 23 November 2001).

10
procedures for businesses so as to create a facilitating environment for enterprises.
However it is unclear by how much Vietnamese businesses have benefited from this
support. The number of small and medium enterprises in Vietnam is still increasing,
despite some forecasts that 80% of SMEs are having difficulties, and 20% will eventually
disappear (Online policy dialogue of development pathway of Vietnamese SMEs, 2010).
In the context of global economic difficulties and international integration, assessing the
competitiveness of SMEs in terms of their position, strengths, weaknesses, opportunities
and challenges becomes increasingly urgent. These assessments will be an important
basis for further state support for the development of SMEs in the future.
1.1.3 SMEs in the livestock feed sector in Vietnam
In 2008, large feed mills including CP Group, Cargill and Proconco, made up nearly 70%
of the domestic livestock feed market in Vietnam. Vietnamese farmers nominate large
mills as the “price makers”. Large mills are also criticised as being a catalyst for the
increasing feed prices in Vietnam due to their dominant place in the feed market. There

are open questions about the role of small and medium enterprises (SMEs) in the
livestock feed sector, and whether they can compete with large enterprises given the
current market structure.
There have been different discussions on the classification of SMEs enterprises in
general, as well as livestock feed SMEs in particular. The classification in Vietnamese
feed enterprises is usually based on the design capacity of the mill, rather than the number
of employees, or shareholders’ funds or fixed assets, or capital, all of which are used in
some ASEAN countries. However, this indicator of design capacity may be used
differently by agencies such as MARD, VAFA and enterprises themselves to differentiate
between small, medium and large enterprises. This issue of classification of enterprise
size is still very much open to discussion.
As yet, there are very few studies on the economic efficiency of feed mills in Vietnam,
and their distribution channels. Recent data from the Vietnamese Animal Feed
Association (VAFA), dated to February 2009, suggested that there were around 40
domestic trading and feed-producing enterprises that were at risk of production closure or
bankruptcy due to costs incurred when import prices increased rapidly. There has been
little research on the competitiveness of the small and medium mills, compared to the
larger ones and especially in terms of their use of input materials and how these relate to
output. The aim of this study is to fill this gap by providing information on the production
and business activities of the different sized feed mills, their distribution channels, and
their technology levels. This information is important to help policymakers build suitable
policies for the livestock industry in the years to come.

1.2 Objectives
The main aim of this livestock feed mill survey is to provide a quantitative assessment of
the factors affecting the competitiveness of the animal feed industry in Vietnam. To do
that, the following objectives have been addressed:
• to give an assessment of mill characteristics and production costs, output and
prices by types of ownership, regions and size of feed mills;
• to find out the nature of information and product flow, quality control standards

and processes for livestock feed mills; and

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• to assess the competitiveness of SMEs compared to large feed mills.

1.3 Research questions
During the scoping activities carried out for the study, it became apparent that small mills
were often regarded as those that usually used cheap, low-protein materials (sometimes
with contaminants), lacked adequate quality control and had poor equipment, and
therefore sold their product at a relatively low price. Their main buyers were thought to
be small producers and agents, especially those living in remote areas. However, some
people argued that Vietnamese SMEs could survive and compete in niche markets, as do
similar feed mills in Thailand.
Therefore, in this study, the aim was to gain a deeper insight into feed production and
trading generally, especially for both small and large scale mills.
The research therefore focused on answering the following questions:
• Are economies of scale evident in the livestock feed sector in Vietnam?
• How different is production and trading between large feed mills and SMEs in
terms of material input use, storage, product types, quality control, types of
customers and services offered to customers?
• Are the raw material procurement and output distribution channels used by SMEs
and larger feed mills different?
• How do domestic SMEs compete in the sector against larger foreign-owned mills?
• Is there any evidence of prices for raw material imports being higher than
domestic prices for raw material inputs?
• Is there an opportunity for Vietnamese SMEs to compete in niche markets? (e.g.
smaller mills targeting more remote areas)?
• What are the constraints facing SMEs operating in the livestock feed sector in
Vietnam?

1.4 Methodology
1.4.1 Background research
Several scoping activities were conducted in the initial stages of the project to obtain
general ideas of issues facing the livestock feed sector, and these were used as the basis
for designing a survey of feed mills in Vietnam .
Pluske’s (2007) report titled “A Desktop Review of the Animal Feed Sector at a Global
Scale” was used as background material to context the survey. The report concluded that
it is possible that SMEs will have a role to play in the feed sector in developing countries,
especially for those in remote areas where it is not profitable for the larger companies to
operate. However, appropriate policies will need to be developed to ensure that the
presence of these SMEs is beneficial for society as a whole and not just one sector within
it. As a consequence policy makers will need to have adequate knowledge of the relevant
supply chains and other institutional arrangements involved in decision making in the
feed and animal sectors.

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To gain an understanding of the current issues facing feed production enterprises and
farms, in August 2007, researchers associated with this project engaged in field tours and
visited a number of senior industry leaders. These activities reiterated the infrastructure
and output differences between the large animal feed firms and the SMEs. Further,
discussions with animal producers and industry leaders provided insight into determinants
of demand for feed.
1.4.2 Survey design and sites
The questionnaire for animal feed manufacturers was designed on the basis of all
stakeholders’ ideas, pre-tested and finalized after critical discussion. The field survey was
a face-to-face interview with a senior staff member of each feed mill. Each interview
generally took between two and three hours to complete. In some instances enumerators
needed to return to the enterprise to either complete or clarify the data collection. Feed
mills in seven provinces across the country were selected to take part in the survey, which
took place between May and June 2008.

To obtain an overview of animal feed production patterns and feed uses, a survey of pig
and chicken producers was also designed as part of this project. It was conducted during
November and December 2008 in 6 of the same 7 provinces. These data are presented and
discussed in Volume II.
To cover a broad cross-section of animal feed enterprises, the field work was undertaken
in three ecological regions, in provinces that are the biggest producers of livestock feed.
Feed mills were surveyed in Ha Noi, Ha Tay and Hung Yen provinces located in the Red
River Delta; Binh Duong and Dong Nai in the South East; and Tien Giang and Long An
in the Mekong River Delta. The three regions had previously been identified in the project
proposal, while six out of seven provinces were agreed upon by the project team and
CARD, based as being representative of their regions. Hung Yen was added because of a
lack of enterprises in Ha Noi, resulting from recent changes in this province compared to
2006 data (on which the original selection of provinces was made) and because many of
the companies listed in 2006 had gone out of business.
1.4.3 Sampling design
Based on a Department of Livestock Production list of feed enterprises current for 2006,
as well as the limitations of the project budget, we initially planned to survey a total of 70
feed mills and agents in the six provinces identified in Section 1.4.2. The sampling
strategy, to ensure a representative selection of small, medium and larger mills, was
designed as follows:
• A list of 241 feed mills operating in 2006 (including their location and capacity)
was obtained from the Department of Livestock Production.
• A stratified size classification criteria of mills was specified with mills divided
into 5 classes based on output capacity (tonnes/year): (1) <5,000; (2): >=5,000
and <10,000; (3): >=10,000 and < 20,000; (4): >=20,000 and <80,000; and (5):
>=80,000.
• Given 70 mills were required to take part in the study, the number of mills of each
size to be sampled in each province was calculated so that they were in proportion
to the actual number and size distribution of mills located in the seven survey
provinces.

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• In the case that one of the 5 classes was under represented in a province (for
example, the class with capacity of more than 80,000 tonnes), mills from other
province were included to make up the required number. For example, Hung Yen
province (in the Red River Delta) has similar characteristics with Ha Noi and Ha
Tay and so could be used as a substitute province.
• Mills from the list were randomly selected until the desired number was achieved.
However, many mills on the list had gone out of business and could not be replaced with
equivalent mills and hence only 62 mills were used in the study. The final sample
distribution from the seven provinces is shown in Table 1.

Table 1. The number of enterprises listed as available for the survey, the number of
enterprises surveyed in the project and the percentage of enterprises in each
province surveyed with respect to the project total

Province Region Enterprises
available
Enterprises
surveyed
Percentage
surveyed
Ha Noi Red River Delta 41 9 14.5
Ha Tay Red River Delta 11 6 9.7
Hung Yen Red River Delta 24 12 19.4
Binh Duong South East 28 19 30.7
Dong Nai South East 17 9 14.5
Long An Mekong River Delta 6 4 6.5
Tien Giang Mekong River Delta 4 3 4.8
Total 131 62 100

1.4.4 Data collection and processing
Before each survey, secondary data and information were collected to obtain an overall
background of livestock production and feed use in a particular province. During the
survey, our experienced enumerators worked under close supervision and were randomly
checked by the project team. The information provided by the respondent sometimes was
not consistent between different sections of the questionnaire because of the reluctance of
some enterprises to provide certain information. After completion of the survey, data
entry was conducted using the Microsoft Access program. The data entry template was
designed and run by the project team at the survey time. The final dataset was converted
to Stata™ format, with notes attached for specific cases so it was easier for doing data
analysis at the later stage.
As mentioned above, some data provided by companies was not very consistent. Data
checking and cleaning were done very carefully to ensure that matching sections of data
were consistent. For example, we compared the stated quantity of raw material inputs
against product output and in a few cases where they were really inconsistent and we
could not resolve why, we rejected the questionnaire from the sample. One of the other
data problems we encountered was the sensitivity over cost of production questions. In
order to deal with this we provided respondents with the opportunity to answer cost of
production in absolute or percentage terms. Then, because we had detailed information on
raw material input costs we could use the percentage cost of production data to infer total

14
costs of production in cases where they did not answer directly. In cases where they did
answer the total raw material cost we used a comparison between the stated costs of
production and the calculated raw material input cost as part of the data checking process.
Ultimately, although the total sample surveyed was 62 mills, only data from 44 mills were
accepted for analysis of scale and cost of production.
Table 2 describes the total original sample size for each ownership status. In addition, the
mills that provided consistent production data were able to be classified by size.
The scale

classification used, based on the animal feed production data of mills in 2007, was as
follows: small - less than 10,000 tonnes/year; medium - from 10,000 to less than 60,000
tonnes/year, and the large group are those with production of 60,000 tonnes or more.
Preliminary data analysis indicated that this size classification provided some distinction
between the large and medium-small mills, and the number of small and medium mills
was roughly equivalent. The classification of medium and small firms highlighted the
very small mills which made up half the small-medium mills in the survey.
Around 70% of the total sample was accepted for providing consistent cost of production
and scale data while the rest was omitted (Table 2). Particularly, nearly half of those
companies in the registered private foreign group were rejected during the data cleaning
process due to either non-response or inconsistency in response on the cost of production
data. In this report all the analyses of region and ownership status was done with the total
sample of 62, but data from only 44 mills was used when analyses were based on the
scale classification.

Table 2. For each ownership category: the total number of mills in the original
sample; the number in each classification and total number providing consistent
information for data analysis; and the percentage of the original sample that
provided consistent information

Original
sample By scale classification
a

% of original
sample
By ownership status
Small Medium Large Total
State owned company 3 1 1 1 3 100.0
Equitised 14 6 4 2 12 85.7

Registered private
foreign 13 1 4 2 7 53.9
Joint venture 4 0 2 1 3 75.0
Registered private
national 28 9 9 1 19 67.9
Total 62 17 20 7 44
71.0
a: With respect to feed output, small is <10,000t/yr; medium is 10,000 to <60,000t/yr; large is
>=60,000t/yr




15
1.5 Limitations and structure of the report
1.5.1 Limitations
One of the main limitations of this study was difficulties in approaching enterprises and
collecting some of the information. In particular, most companies were not willing to
provide detailed business information related to production and revenue. Like other
enterprise surveys, the results of this survey depended on external factors that were out of
control of the project team. Though the sampling method was logical, substantial
adjustments had to be made to the actual survey depending on the availability of current
mills, as well as respondents’ willingness to answer questions. As a result, data cleaning
and analyses were difficult and time consuming for our team, as we endeavoured to
ensure that information in different sections of the survey was consistent.
Secondly, limited enumerators and difficulties in approaching the leaders of enterprises
interrupted the survey in different provinces. This difficulty together with the dispersed
distribution of the 62 feed mills located in 7 provinces and 3 ecological regions of
Vietnam meant that survey implementation took longer than anticipated.
Another key constraint was the necessity to omit inconsistent data and observations from

the analyses. A larger sample would have produced results with greater validity and
reliability but due to the limited budget, combined with the broad content requirement of
the study, it was not possible to extend the sample size.
1.5.2 Structure
This report consists of seven additional sections. Section 2 is an overview of the most
recent changes in the Vietnamese feed industry, including a discussion of production, and
price fluctuations of different feed types and raw materials. The results of the feed mill
survey, including data on general information, production patterns, raw material use, feed
output and supply chain as well as other relevant issues (such as transportation,
communication, credit, profitability and investment, opportunities, constraints) are
presented from Section 3 to 7. A summary of the key findings and policy
recommendations for the feed industry in general and SMEs in particular are discussed in
the final section.


16
2
RECENT CHANGES IN THE VIETNAMESE FEED INDUSTRY
The livestock feed processing industry in Vietnam has developed rapidly since the 1990s
with the growth of the livestock industry. The average growth rate of total feed
production has tended to rise since the year 2000, reaching 16.6% on average from 2000
to 2008 (Table 3).

Table 3 . Industrial feed production in Vietnam during the period 2000 – 2008

Year
Complete
feed
(‘000t)
Concentrated

feed
(‘000t)
Total

(‘000t)
Total (complete
feed equivalent)
(‘000t)
Growth rate

(%)
2000
1,700 330 2,030 2,690
2001
1,950 350 2,300 3,000 11.5
2002
2,400 340 2,740 3,420 14.0
2003
2,650 400 3,050 3,850 12.6
2004
2,700 400 3,100 3,900 1.3
2

2005
3,238 702 3,940 5,344 37.0
2006
4,361 747 5,118 6,600 23.5
2007
5,300 825 6,125 7,776 17.8
2008

6,882 684 7,567 8,935 14.9
Average
(%)
16.6
Sources: Strategy for Livestock Development to 2020 (Department of Livestock Production 2007), Nguyen
(2009)


Recognizing a potential profit in feed production, there has been an increasing number of
foreign and domestic companies setting up their businesses in Vietnam. Further, due to
the reform policies of the Government as well as foreign and domestic investment
encouragement, multi-national feed companies, such as Cargill, CP, Proconco and Japfa,
have commenced production in Vietnam.
Data from the Department of Livestock Production showed that there were 241 registered
feed mills
3
in Vietnam in 2006, of which there were 33 foreign, 10 joint ventures and 198
domestic mills. The total feed production (complete equivalent plus premix) in 2006 was
6612.4 thousand tonnes, accounting for around 75 per cent of the design capacity of
8803.9 thousand tonnes (Figure 1). The Red River Delta, had nearly half of the total
number of Vietnamese enterprises and had the largest capacity of the 8 regions with total
industrial production being 2427.1 thousand tonnes (Figure 1). The South East region had
the largest feed production (3274.5 thousand tonnes) with mills using almost all of their
capacity (Figure 1). The third largest production region was the Mekong River Delta


2
Growth rate slowed down as animal feed for poultry reduced by 25-30% during bird flu (Department of
Livestock Production 2006)
3

The total number of registered feed mills in Vietnam in 2008 is 225, which consists of 42 foreign, 12 joint
ventures and 171 domestic ones. Red River Delta and South East region remain the two biggest feed
producing areas, accounting for 45.8% and 28.9% of the total national feed mills respectively.

17
(771.6 thousand tonnes), followed by the North Central region. The smallest feed
producing region was the Central Highlands with two small mills producing about 200
tonnes. The development of the livestock feed sector, with the existence of big feed
enterprises from abroad, has gradually changed the traditional patterns of raising livestock
and poultry in Vietnamese households. Many households no longer use home produced
raw feeds to raise their animals. Instead they have increased their use of industrial feed in
the Southern provinces, or mix industrial and raw feeds for producing livestock in the
North.

36.8 22.3
2427.1
67.6
13.4 0.2
3274.5
771.6
6612.4
0
2000
4000
6000
8000
10000
North
E
ast

North West
Re
d
R
iver
D
elta
North Centr
a
l
R
eg
io
n
South Central Coast
Centra
l
Highland
s
S
o
uth E
ast

r
egion
Mekong River Delta
T
otal
Region

thousand ton
0
50
100
150
200
250
300
no.
Industrial feed production Capacity No. of enterprises

Source: Department of Livestock Production, 2006

Figure 1. Number of feed enterprises, total industrial feed production (plus premix)
vs. capacity by region in 2006
Local input availability for feed production, particularly for protein rich ingredients, is
limited compared to local demand for feed, with the deficit being met through imports.
The deficit was almost 3 million tonnes in 2006 which is almost double that of 2005
(Table 4).
It is estimated that more than 10 types of ingredients out of a total of 22 types is imported
by feed enterprises. Data from Department of Livestock Production (2007) showed that
the import quantity of materials for feed production in 2006 reached 3170.7 thousand
tonnes (Table 5) with a value of 11.8 thousand billion VND and accounted for about 40%
of the 30.4 thousand billion VND of local industrial feed production value. Import trends
for some raw materials increased markedly in the two following years, especially for

18
soyabean, soybean cake, fishmeal, premix vitamin, and over 3,000 tonnes of feed
materials has been imported in the first half of 2009. It is clear from the data in Table 5
that the Vietnamese animal feed sector depends more on imports for protein inputs than

for energy inputs. In addition, the domestic industry has not yet produced materials for
premix and additives.
Table 4. Domestic production of the main inputs for feed production and estimated
demand for feed input (1000 tonnes)

Material type 2005 2006
1. Broken rice, paddy and bran
4
6084 6090
2. Maize 3401 3437
3. Cassava and potato 2421 2785
4. Soybean and soybean cake 114 127
5. Fish meal 35 112
6. Mineral and premix 68 138
Total domestic output for
feed production
12123 12975
Feed input demand
13630 15864
Deficit -1507 -2889
Source: Strategy for Livestock Development to 2020, Department of Livestock Production (2007)

Table 5. Quantity of imported feed inputs to Vietnam in 2006 (‘000t)

Feed input
2006 2007 2008 First 6 months
of 2009
Maize 564.5
612.8 467.8 871.6
Extracted rice bran 190.2

488.0 199.9 259.9
Wheat bran, flour 490.6
333.6 639.5 105.9
Vegetable oil, fish oil 26.4
54.2 - -
Soybean cake 1591.8
1686.3 2161.8 1468.9
Soybean 17.6
17.7 293.3 200.9
Maize gluten 35.0
54.0 23.5 15.9
Animal nutrition 10.7
18.7 166.4 77.7
Lactose -
25.9 10.1 -
Fish meal 54.8
41.2 153.8 50.3
Animal by-products 84.2
-
Premix vitamin 8.3
37.5 0.7 12.8
Amino acid (Lyz, Met, Thre) 21.9
19.3 51.9 17.4
Mineral, additive 74.7
98.8 16.1 28.3
Total
3170.7 3488 4184.8 3109.6
Sources: Strategy for Livestock Development to 2020, Department of Livestock Production (2007, 2009)

4

Broken rice is 3% equivalent to rice; paddy for feed production is equal to 3% of its production and bran is
equal to 11%. The share for feed production of maize is 90%; cassava and potato 80% and soybean 33%.

19

Imports of animal feed and materials for feed processing have been on an upward trend,
especially in the last two years (Figure 2). In 2001, the import value was less than
200,000 thousand USD and it increased by 6 times in 2007. The estimated value for 2008
was over 1,700,000 thousand USD.
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
1,800,000
thousand USD
2001 2002 2003 2004 2005 2006 2007 2008
(estimate)
Year

Source: MARD, 2009
Figure 2. Vietnam’s import value of animal feed and inputs for feed processing, 2001
- 2008
In the last few years there has been a sharp increase in the price of many raw materials
used in livestock feed production. Figure 3 shows the trends in prices of some raw
materials in Vietnam from 2007-2008. Prices of the two main ingredients (maize and

soybean cake) have been continuously on an upward trend. The price of domestic maize
rose with the international prices, as world demand for making ethanol is increasing.
Soybean cake accounts for 60 to 70% of the production cost of concentrate feed and 20 to
30% of the complete feed cost. It is sourced from countries such as America, Argentina
and India and generally the price has doubled from less than 5,000 VND per kg to around
10,000 VND per kg during the time period, March 2007 to September 2008. Additionally,
prices of Mono Calcium Phosphate (MCP) also steadily increased during the same period.
The price of fish meal seemed to be on a downward trend during 2007 but then started
increasing again sharply from early 2008. It should be noted that there was a relatively
large difference in the prices of imported and locally produced fish meal.
Proconco, a large livestock feed joint-venture company, provided prices for some of the
main feed inputs as well as for complete feed for pigs (Figure 4). Based on the upward
trend in their prices during the year 2007, there appears to be a tendency for feed prices to
be adjusted as input prices go up (Figure 4). Except for the price of cassava which
increased only by 10 percent, the prices of other ingredients rose considerably, especially
soybean cake which was the most expensive with an increase in price of more than 50%
compared to early 2007. The price of complete feed for pigs weighing between 30 and 60

20
kg, grew by around 30% during the 12 months. Given the higher complete feed prices, it
would seem that the changes in raw material input costs were passed on to the buyer.

0
2000
4000
6000
8000
10000
12000
14000

16000
18000
20000
Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08
dong/kg
Domestic maize Imported maize
MCP Yam
Rice bran Fish meal 60% domestic protein
Fish meal 60% import protein Argentina soybean cake

Source: Department of Livestock Production, 2008
Figure 3. Prices of some raw feed inputs in Vietnam during 2007-2008
0
1000
2000
3000
4000
5000
6000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
dong/kg
Maize Soybean cake Cassava Complete feed (30-60kg)

Source: Department of Livestock Production
5

Figure 4. Prices of raw materials and pig complete feed for Proconco company in
2007

5
Note: Proconco’s price (2008) (VND/kg, VAT is not included)

21
3
BACKGROUND INFORMATION ON FEED ENTERPRISES IN
VIETNAM
3.1 General characteristics
Figure 5 shows the size classification of the surveyed feed mills in the north and south of
Vietnam. The size classification used here and throughout the report, unless otherwise
stated is: large size is production greater or equal to 60,000 tonnes/year (n = 7), medium
is those producing between 10,000 and less than 60,000 tonnes/year (n = 20), and those
producing less than 10,000 tonnes/year (n = 17) are classified as small enterprises. In
general, the feed production scale tends to be larger in the south than that in the north.
Half of the total mills in the north are small scale compared to around 27% in the south.
Meanwhile the share of medium and large enterprises is both higher in the south. Around
45% of southern mills are medium-sized ones compared to 27% in the north.
0.0
10.0
20.0
30.0
40.0
50.0
60.0
north south
%
Small Medium Large

Figure 5. Distribution of feed enterprises by production scale in north and south

Vietnam (%)

Table 6 shows the difference between actual output and design output in 2007 by size and
region of surveyed feed mills as well as percent utilization of design output. By region,
the actual average output of small and medium mills is lower in the north compared to
that in the north. There are more small mills in the north than in the south (see Figure 5).
Large mills in the north have relatively larger actual production than those in the south
(78,429 tonnes versus 66,225 tonnes). However, overall, the average feed output of
northern mills seems to be lower than southern ones (18,697 tonnes compared to 26,092
tonnes).
There are some similarities in the use of design capacity of mills at all size groups. In
both regions, enterprises by all size groups produce a little bit less than their design
capacity, except for the case of medium mills in the north (22,400 tonnes of actual output
versus 22,293 tonnes of designed output). A bigger gap is seen in large enterprises located
in the north where their actual output reached less than 80,000 tonnes while their designed

22
output is 110,000 tonnes. Notably, the designed output is very much larger in the northern
large mills than in the southern large ones.
The average capacity utilization is fully maximised in the northern medium mills while it
seems to be lowest in the large group (71.3%). In the south, the utilization rate increases
by production scale, ranging from 89.4% to 98.1%.

Table 6. Actual and designed output of feed mills, and percent utilization of designed
output in 2007, by scale and region

North (n=27) South (n=35)

Actual
output

(tonnes)
Designed
output
(tonnes)
Percent
utilization
(%)
Actual
output
(tonnes)
Designed
output
(tonnes)
Percent
utilization
(%)
Small 2,543 3,255 78.1 5,325 5,955 89.4
Medium 22,400 22,293 100.5 24,818 26,691 93.0
Large 78,429 110,000 71.3 66,225 67,509 98.1
Overall 18,697 22,519 83.0 26,092 27,630 94.4

Revenue from different activities of feed mills is very diverse among the three mill
groups (Table 7). Large mills depend completely on feed production activities while small
ones tend to diversify their business by being an agent or premix producer with the share
of revenue for these activities being 7.5% and 2.5% respectively. Regarding production
activities only, production of concentrate feed is relatively more important for small mills
compared to medium and large mills, with less concentration on complete feed. The
percentage of revenue from complete feed is over 50% for small mills while it is over
80% for both medium and large ones. In terms of magnitude of revenue, large obtain 7
times and medium, 5 times more revenue for concentrate and complete feed than small

mills.

Table 7. Average revenue from activities of feed enterprises in 2007

Revenue (million VND) Share (%)

Complete
feed
Conc.
feed
Buy and
sell feed
Other
Total
Complete
feed
Conc.
feed
Buy and
sell feed
Other
Small
10,505 4,404 1,293 255
16,458
53 37 7.5 2.5
Medium
102,332 22,294 50 0
124,676
82 18 0.2 0
Large

510,100 79,294 0 0
589,394
87 11 0.0 0.0
Overall
140,203 25,644 486 91 166,424 72 24 2.7 0.9

3.2 Labor use and wages
Figure 6 shows the distribution of labor numbers in domestic and foreign-owned
feedmills
6
. Around two thirds of total domestic enterprises have less than 100 employees


6
Foreign-owned mills include joint-ventures

23
while this number is less than 39% for foreign enterprises. Meanwhile, about one quarter
of total foreign mills have above 300 employees
7
compared to only 8.9% of domestic
ones. An analysis of labour productivity is presented in section 4.2.

66.67
38.89
24.44
38.89
8.89
22.22
0% 20% 40% 60% 80% 100%

Domestic
(n=45)
Foreign
(n=17)
Less than 100 100-300 employees More than 300 employees


Figure 6. Labor size of feed enterprises by foreign and domestic ownership

Figure 6 gives some indication of enterprise scale for the whole sample of 62 mills,
Employee numbers can be used as a proxy indication for scale (see footnote 7): with
small enterprises having less than 100 employees, medium enterprises having 100 – 300
employees, and large enterprises having more than 300 employees. Using these criteria,
then for the whole sample of 62 mills, 58.7% are small enterprises, 28.6% are medium
enterprises, and 12.7% are large enterprises. This compares with our classification of 44
mills which gave 38.6% being small enterprises (producing less than 10,000 tonnes/year),
45.5% being medium enterprises (producing between 10,000 and 60,000 tonnes/year),
and 15.9% being large enterprises (producing more than 60,000 tonnes/year). The
classification of large firms is roughly similar; our classification of medium and small
firms in this exercise was chosen to highlight the very small mills which made up half the
small-medium mills in the survey.
Figure 7 shows the number of employees for the firms in our categories of small, medium
and large. Only 14% of the large mills have more than 300 employees, perhaps reflecting
the capital intensive nature of the production. However, a high percentage of both the
small and medium categories have less than 100 employees: 88% and 70% respectively.


7
Vietnam classifies SMEs as those firms with less than 300 employees. In the following we suggest that
medium scale is more than 100 employees.

24
87.5
70
12.5
30.0
85.7 14.3
0% 20% 40% 60% 80% 100%
Small
(n=17)
Medium
(n=20)
Large
(n=7)
Less than 100 100-300 employees More than 300 employees


Figure 7. Labor size of feed enterprises by production scale

Figure 8 shows the average salary that was paid to labourers in small, medium and large
enterprises. Office staff usually receive a higher salary than factory floor workers and the
difference is considerable, especially in large mills. Considering mills by production
scale, in large mills, the salary of office staff is nearly double and that for workers is 1.5
times higher than that in small mills. Generally, family laborers tend to have a lower
salary than hired labor.

0
500
1000
1500

2000
2500
3000
3500
4000
Total Family Hired Total Family Hired Total Family Hired
Small Medium Large
000VND/person/month
Admin/Technic/Marketing Factory workers


Figure 8. Average salary for labor of feed enterprises by production scale