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Ministry of Agriculture & Rural Development

Project Progress Report

FIRST SIX-MONTHLY REPORT

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 Date: 1
st
January 2008

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1. Institute Information
Project Name
Developing a strategy for enhancing the
competitiveness of rural small and medium
enterprises in the agro-food chain: the case of animal
feed
Vietnamese Institution
Institute of Policy and Strategy for Agriculture and
Rural Development
Vietnamese Project Team Leader

Senior Research Officer
Fax:
+61 8 6488 1098
Organisation
University of Western
Australia
Email:
[email protected]

In Australia: Administrative contact
Name:
Ms Jan Taylor
Telephone:
+61 8 6488 1757
Position:
School Manager
Fax:
+61 8 6488 1098
Organisation Agricultural and Resource
Economics, University of
Western Australia
Email: [email protected]
In Vietnam
Name:
Ms. Pham Tuyet Mai
Telephone:
+84-4-7280493
Position:
Researcher – Market Analysis
Unit

3. Executive Summary
Contract signing for this project was delayed, but work commenced not long after the
scheduled project implementation date of 1
st
May 2007. Australian team planning meetings
commenced at UWA on a regular basis from the second week of May, and joint planning by
the Vietnamese and Australian teams for the Project Inception Workshop and first training
activities commenced in June 2007.

Team meetings were held in Hanoi at the Centre for Agricultural Policy (CAP) between 2
nd
–
10
th
August. Ms Sally Marsh, Dr Donna Brennan, Professor John Pluske and Dr Jo Pluske
travelled to Hanoi for these meetings. Highlights of these meetings included:
• A half-day workshop held at IPSARD on 7
th
August to scope issues facing the
livestock feed sector attended by a range of industry stakeholders and others.
• Field trips to a range of feedmills and livestock farms, and meetings with industry
representatives.
• Training activities linked to the workshop and field visits focussed on identifying
problems and issues, developing researchable questions, identifying data required to
address research questions, and developing the survey instrument (questionnaire).

Dr Jo Pluske has completed a draft report entitled “A desktop review of the animal feed
sector at a global scale” which will contribute to the identification of both key policy and
operational issues in the feed sector. This report is being reviewed by the project team prior
to its finalisation.

Several joint meetings have been held with visiting ILRI scientists, Dr Donna Brennan, and
the Vietnamese team to build on synergies between the projects. The Director of ILRI
recently visited Vietnam and was briefed on the CARD project activities.

4. Introduction & Background
The underlying aim of this project is to investigate the circumstances under which SMEs in
Vietnam can operate at an efficient level and compete with other firms or not, especially in
the context of the globalization process. This project seeks to gain benefit from Australian
collaboration in designing methodology that can be used in ongoing work at IPSARD. In this
study the animal feed industry is being used as a case study, but the methods and lessons
learned will be applicable in other areas of agricultural marketing. The proposed training and
supervised research exercises will provide the IPSARD/MARD with a suitable methodology
for ongoing work in quantitative policy analysis.

The project will be carried out using a combination of training courses, and supervised
research exercises combining collection of secondary data, field work, analysis and synthesis
of findings in reports and policy briefs. Training will focus on building skills and experience
in market analysis, including value chain analysis, production economics, and industrial
organisation. Field work will be undertaken in several sites incorporating the three regions,
Mekong Delta, South East region and Red River Delta, to cover a broad cross section of
performance of animal feed enterprises. Local stakeholders will be involved throughout the
process, and findings communicated through a workshop held in each region.

Specific activities and outputs under the project objectives will include:
Objective 1: Build capacity at IPSARD agricultural marketing research, specifically in
analysis of the value chain, industrial organisation, and production economics
• Training workshops at IPSARD on survey and data collection techniques; and market
analysis, including value chain analysis, production economics, and industrial
organisation.
• On-the-job training for IPSARD staff on assessment of competitiveness of SMEs and

th
August. Sally Marsh, Dr Donna Brennan, Professor John Pluske and Dr Jo Pluske
travelled to Hanoi for these meetings. Highlights of these meetings included:
• A half day stakeholder workshop held on 7
th
August to scope issues facing the
livestock feed sector with a range of industry stakeholders and others. Opportunity
was given to key people in MARD, the Animal Feed Association and from the
processing sector to address the workshop. The workshop program, participant list
and workshop report are included as Appendix I.
• Field trips to a range of feedmills and livestock farms.
• Meetings with Mr Le Ba Lich, Chairman of the Animal Feed Association, and Dr
Tran Cong Xuan, Chairman of the Vietnam Poultry Association.

Dr Jo Pluske submitted a final draft report to the project team, “A Desktop Review of the
Animal Feed Sector at a Global Scale”, in September 2007. This report is currently being
reviewed by the project team.

Dr Donna Brennan and Sally Marsh held further working sessions with members of the
Vietnamese project team in late October/early November to progress the questionnaire
design.
5.2 Smallholder Benefits
At this stage of the project no smallholder benefits have been achieved, but this remains an
objective of the project, through increased efficiency and competitiveness in the livestock
feed sector.

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5.3 Capacity Building
Capacity building activities at IPSARD/CAP have commenced. Activities in this first six
months have been designed to:

There have been a number of changes in the Vietnamese personnel working on the project.
Firstly, Mr. Phung Duc Tung has been in Germany since August 2007 in order to pursue his
PhD study, therefore, could not continue joining the project. Dr. Nguyen Anh Phong then
was assigned to replace Mr. Phung Duc Tung as technical supervisor for the CAP team.
Second, Mr. Hoang Dinh Quoc is also involved in a PhD preparation that makes him
unavailable for the project. Ms. Pham Tuyet Mai took over the work of Mr. Hoang Dinh
Quoc. Also, Ms. Nguyen Le Hoa and Ms. Tran Thu Ha was assigned to be in charge of other
work, and Ms. Pham Thi Lien Phuong and Ms. Nguyen Thi Thinh in the Market Analysis
Unit were assigned to do the work instead.

(See Personnel Inputs table in the Statutory Declaration for more details on the contribution
of each team member).

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6. Report on Cross-Cutting Issues
6.1 Environment
Questions addressing environmental issues and concerns are being included in the survey
instrument, and scoped in the Desktop Review.
6.2 Gender and Social Issues
Questions addressing gender and social issues and concerns (e.g. females working in
livestock and livestock feed businesses, health and safety issues in the sector) are being
included in the survey instrument, and scoped in the Desktop Review.
7. Implementation & Sustainability Issues
7.1 Issues and Constraints
The late start to the project has put pressure on timing of training activities from the
perspective of both the Vietnamese and Australian team members. However, these activities
will be able to be accommodated as the project progresses. The Australian team wants to
work with the Vietnamese team to ensure that training being delivered is relevant and
needed.

• Study tour to Thailand in March 2008.

9. Conclusion
Activities during this first six months of the project have focussed on scoping the issues
facing the livestock feed sector in Vietnam by: 1) collecting available secondary data and
reports; 2) conducting an implementation workshop involving industry stakeholders; 3)
hands-on training in research-scoping skills conducted through field visits and stakeholder
meetings; and 4) planning sessions for the desktop review and survey instruments.

The late start to the project has put pressure on timing of training activities from the
perspective of both the Vietnamese and Australian team members. However, these activities
will be able to be accommodated as the project progresses. There have been some difficulties
in developing a comprehensive survey that will provide the needed data, yet at the same time
not be too difficult or lengthy for firms to complete.

Activities for the next six months are planned and progressing. 89
Project Progress Against Proposed Objectives, Outputs, Activities And Inputs
Project Title: Developing a strategy for enhancing the competitiveness of rural small and medium enterprises in the agro-food chain: the case of animal feed
Vietnamese Implementing Institution: Institute of Policy and Strategy for Agricultural and Rural Development
PROPOSAL PROGRESS REPORT
Narrative Information Required Performance
Measures
Assumptions Information Required
OBJECTIVE 1:

This objective is still very relevant – as IPSARD/CAP have many
commitments to the Ministry and need capacity (e.g. problem
formulation into researchable questions, data collection and analysis
skills) to deliver useful information. OUTPUT 1.1

A training manual is developed over the life
of the project, incorporating experience and
knowledge gained during the training and
case study

This output will be a hardcopy and
electronic resource and so contribute to both
institutional capacity within IPSARD/CAP,
and also sustainability of the knowledge and
skills gained in the project.

Training manual is
developed and
approved by IPSARD
1. Case study provides
useful information for
manual.
2. Manual will be
relevant for future

The Australian team met with the
IPSARD/CAP team during August 2007 to
discuss and investigate issues relevant to the
training manual such as:
• Tangible outcomes from the project
expected by IPSARD/CAP.
• Overview of other livestock projects
being undertaken by IPSARD/CAP and
needed knowledge/skills for these
• Key factors/indicators for feed-mill
operations
• Factors affecting competitiveness
• Factors affecting the supply/value chain

INPUTS
Time and expertise of Australian team
members, direction on useful manual
content from Vietnamese team members.

Australian team members have provided guidance in the scoping of
issues and problem identification, and survey design (specifically
identification of critical data needed) during the reporting period.

The input of Professor John Pluske during this period was critical to
building capacity of the team in relation to key indicators and
operations of feedmills, and aspects of nutrition and livestock feed
safety.

IPSARD/CAP staff already had a great deal
of practical survey experience in the field.
Active participation
by IPSARD staff in
training courses;
Learners understand
the method, and can
use the techniques in
On-going hands-on supervision of the survey process is planned as
being part of the training in this area.
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However, they lacked skills in more
fundamental areas. The planned workshop
on survey data collection, was re-planned to
address more fundamental issues such as:
• identification of problems and issues,
• developing researchable questions,
• identification of data required to address
research questions, leading to
• development of the survey instrument
(questionnaire)

Team meetings and training in these areas
took place from August 3-8. Training was
provided by Dr Donna Brennan, Sally
Marsh and Professor John Pluske. The
training was interactive and linked with

by IPSARD/CAP staff.

OBJECTIVE 2 Understand the role and performance of
SMEs in the animal feed sector in other
countries, draw lessons from their
experiences

Staff at IPSARD/CAP will be the primary
beneficiaries of this Objective. A better
understanding of the role and performance
of SMEs is of significant interest to the
While this Objective is still relevant, outputs and activities under this
objective are designed to deliver more than just information on
SMEs in the sector. Work being undertaken in activities under this
objective will provide information on developments in the global
animal feed sector, and address issues such as competitiveness,
efficiency, and feed quality and safety.

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Vietnamese government for policy in the
rural sector.

OUPUT 2.1
A report on the world animal feed sector
and the role and performance of SMEs in
other countries


effectiveness of
SMEs
- role of the poor in
the value chainInformation on SMEs in
other countries
accessible and relevant
It has proved difficult to obtain information about SMEs in other
countries. The reviewer (Dr Jo Pluske) has been able to access
information on SMEs mainly from China, the Philippines and Japan.
The draft report has not addressed the role of the poor in the value
chain to any great extent.

A draft report is already completed and is being reviewed by the
project team. ACTIVITY 2.1.1
Undertake a desktop review of the animal
feed industry at the global scale, with
special attention to the nature of demand
for feed in industrial and in extensive
animal industries, economies of scale in
feed production, the role of SMEs; and the
role of public policy in supporting the
development of a competitive sector.

Desktop review is

Report in December 07 or January 08. INPUTS
Dr Jo Pluske has already contributed the
time allocated to her for this work.
There will be further input from Dr Pluske to the review following
feedback from the Vietnamese and other Australian team members.
OUTPUT 2.2
Study tour report on the animal feed sector
and the role of SMEs and other producers
in Thailand

The study tour is in the planning stage.
Study tour
undertaken by project
team

Study tour report
written
Relevance of Thai
situation to Vietnam
The study tour is expected to be a valuable learning experience for
the project team. One issue that has arisen (after work done for the
desktop review) is that the livestock feed sector in Thailand appears
to be dominated by large firms. This may affect learning outcomes
related to SMEs from this tour. However, it is expected that the trip
will still be valuable for increasing understanding of factors
influencing competitiveness in the sector.



VCCI has good
relations with Thailand
Business Association
and can help in liaise
and organize study tour

A 2-3 day team session is scheduled for January 2008 to identify
learning objectives for this tour. A facilitated process will encourage
team members to use issues raised in the Desktop Review and
stakeholder consultations to identify the learning objectives.
ACTIVITY 2.2.2
Undertake study tour to Thailand The study tour is scheduled to take place in late Feb/early March
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INPUTS
Australian team leader and 5 Vietnamese
representatives (including 2 industry
representatives) will need to be available for
the study tour. The project team as a whole
will contribute to formulating the learning
objectives.

OBJECTIVE 3 Provide a quantitative assessment of the
factors affecting the competitiveness of

intensive animal farms) consult with key
stakeholders to identify their key concerns
regarding competitiveness, prices, and the
impact of policy. Identify production and
quality issues for different industry
stakeholders.

Industry stakeholders were invited to a half-
day workshop held on August 7
th
2007 (see
Appendix II for program and report). While
the Australian team were in Vietnam in
August 2007, meetings were held with Mr
Le Ba Lich, Chairman of the Animal Feed
Consultations held
with major industry
stakeholders

Key issues from
consultations with
major industry
stakeholders
documented
- Cooperation from key
stakeholders
- Key issues able to be
identified
The industry liaison activities conducted so far have enabled the
team to identify key issues. Documentation of these is in a draft form

While involved in the MARD survey on
Animal Feed Sector, Ms. Nguyen Thi Thinh
got to meet several feed mills, feed agents
and feed buyer (pig producers) in Hanoi.
The draft report of MARD survey is already
available in Vietnamese.

ACTIVITY 3.1.2
Secondary data collection: Drawing on
information from GSO and industry groups,
compile a quantitative description of the
supply chain

The only surveys in which the data on feed
mills could be found is the Annual
Enterprise Survey carried out by the GSO.
Indicators available are:
• Total capital
• Total labor
• Total asset
• Business performance
• Income of labors

Data collected is
suitable for the
objectives of the
research

Quantitative
description of the

experiences from previous surveys
conducted by IFPRI and MARD. This
survey is now close to being piloted. questionnaires
- Questionnaires are
developed based on
information from
activities 3.1.1 and
3.1.2
- Questionnaire
developed and have
unanimity of experts
- Questionnaires
meets requirement of
the analysis
framework 3.1.2 provide adequate
information to develop
suitable questionnaires

instrument has been to try and avoid it being too long and too
complicated, and yet still be able to capture enough data to
adequately map the supply chain and identify factors affecting
competitiveness. The diversity of feedmill operations (identified
through the industry consultation) has also been another
complicating factor, as some mills also operate as livestock


Skills in using data to address policy issues
was identified by IPSARD as an area where
they need improvement in the baseline
capacity survey, so this aspect of the project
is very important.
Most of the work for this objective will take place later in the
project. We have only reported on the work currently being done.
OUTPUT 4.1
Policy briefs written on economics of the
livestock feed sector and the role of SMEs
Policy briefs written
and circulated
Policy directions clear
after completion of
Policy briefs will not be written until the research work is more
advanced.

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research
ACTIVITY 4.1.1
Study of the policy environment affecting
the industry, including: policies affecting
costs of inputs, investment; corporate
organization; supply of traditional
agricultural science and extension services
for animal feed production and use;
regulation and certification.

Questions raised at the Project Inception