Vietnam’s processing of milk and dairy output increased by 26.3 percent in January compared to the 2019 baseline, according to Vietnam’s Industrial Production Index. However, this was lower than December 2024, when output stood at 40.6 percent above 2019 levels.
Month-on-month, production declined in January compared to December by 10.8 points. Despite this, the sector recorded a 4.8 percent year-on-year increase from January 2024, reflecting steady annual growth.
Of note, Vietnam’s milk and dairy processing industry has grown significantly in recent years, driven by increasing domestic consumption, rising incomes, and investments from both local and international dairy producers. The industry plays a crucial role in supplying fresh milk, powdered milk, yogurt, condensed milk, and other dairy products to the expanding consumer market.
Local companies such as Vinamilk, TH Group, and Moc Chau Milk dominate the market, producing a wide range of dairy products to meet domestic demand and export to regional markets. Vinamilk, the largest dairy producer in Vietnam, has heavily invested in modern processing facilities and dairy farms to expand production capacity and ensure high-quality output. TH Group has also expanded its fresh milk production, focusing on organic and high-nutrition dairy products.
The industry benefits from strong consumer demand for milk and dairy products, particularly among young consumers and health-conscious individuals. The growing popularity of yogurt, flavored milk, and dairy-based beverages has contributed to increased production output. Additionally, Vietnam imports a large volume of powdered milk to support local dairy processing, as domestic raw milk production is not yet sufficient to meet demand.
Challenges in the industry include dependence on imported raw materials, fluctuating milk prices, and competition from international brands. However, efforts to expand local dairy farming, improve processing technology, and develop premium dairy products are helping the industry grow sustainably.
See also: Dairy in Vietnam: Industry Overview