Vietnam's corn import tax cut to 2% as of Dec 30, wheat at 0%

Vietnamese government authorities have issued a decree to cut the import tax for corn from 5% to 2% and to abolish the wheat tax as of December 30, according to an official notice issued November 15.

The import tax on wheat was previously set at 3% for most of the origins with the move coming after Local authorities already discussed the possibility of cutting the corn tax to 3% and removing the wheat import tax back in July, with those rumours now becoming official.

The reductions of the tax are to support domestic feed producers and importers, as “Vietnam heavily relies on imported [feed] materials,” a Vietnam-based trader told Agricensus.

“This year is not a good year and we need to see how fast the [feed] market will recover,” another Vietnam-based trader commented on the news, referring to the pressure the Covid-19 pandemic and African swine fever outbreak had on the Vietnamese feed market.

Local participants are expecting a bigger wheat origin variety, with Canadian, US and South American wheat becoming more competitive in price since at the moment only Australian and Russian origin wheat can be imported tax-free.

Vietnam’s feed importers are expected to bring around 11.9 million mt of corn in 2021/22, with feed and residual consumption amounting to 15 million mt, according to the USDA.

Wheat imports are estimated at 3.65 million mt, slightly down from last year’s imported volume of 3.86 million mt.

According to Vietnam’s customs data, 8.5 million mt of corn had been imported since the start of 2021 through to the end of October, down almost 15% year-on-year.

Wheat imports to date stand at 4 million mt, surpassing last year’s figure by 63%.