On July 14, the JPY fell to a new 24-year record low against the US dollar. The main reason why the JPY fell sharply against the USD was because investors were worried that the interest rate gap between the two economies would widen if the Fed continued to raise interest rates.
The Euro also saw the first time in 20 years fall to parity with the US dollar. One of the reasons for the Euro's depreciation was the sharp increase in gas prices and the uncertainty surrounding energy supplies from Russia related to the conflict in Ukraine, causing recession in the Euro area. While the US Federal Reserve Bank (Fed) raised interest rates strongly to reduce inflation, the European Central Bank (ECB) has not made similar decisions.
Depreciation of Euro affect the import demand of seafood from Vietnam
When the Euro depreciates against the USD, although Vietnamese enterprises are not affected because most of Vietnam import and export transactions use USD, the profits of buyers decrease so they can reduce demand for Vietnamese exporters. Besides, when the local currency weakens, imported goods become more expensive, European consumers will consider spending, choosing necessities with affordable prices, which reduces demand.
The JPY fell to a 24-year low against the dollar. There has been a situation where Japanese importers proposed to renegotiate import prices to compensate for their losses when the JPY depreciated. Besides, there is a situation where the customer has signed a contract before, but negotiates to receive the goods slowly. Having suffered a lot when the local currency depreciates, Japanese importers will also adjust their plans and import demand during this period.
Another concern is that when the USD appreciates, the cost of importing raw materials will also increase. This will affect Vietnamese enterprises, who is importing raw materials for processing and exporting.
Accounting for 14% of Vietnam's total seafood export turnover, Vietnam's seafood exports to Japan in the first half of this year reached over 800 million USD, up 18% over the same period.
Under inflationary pressure, seafood prices in Japan have continuously increased in recent years. Moreover, the JPY depreciated, falling to the lowest level in 24 years, making Japanese consumers have to consider and tighten their spending, so it is difficult for seafood exports to this market to have significant breakthroughs from now until the end of the year.
Accounting for 12% of Vietnam's total seafood export turnover, seafood exports to the EU market in the first half of 2022 reached over 688 million USD, an increase of more than 41% over the same period last year. After increasing by 58% in the first quarter, seafood exports to the EU in the second quarter also slowed down, up 31% to reach 390 million USD.
In the context of fluctuations in exchange rate, Vietnam seafood exporter should carefully choose the payment currency
The EU is also a market with high inflation in the first half of this year. The record inflation of 8% in the second quarter shows that the EU's trade is in crisis, after Covid and especially after trade sanctions with Russia due to the conflict in Ukraine. Inflation cast a shadow over the Eurozone economy, reducing consumption demand of Europeans.Therefore, high-priced seafood products will be on the list that consumers must consider to reduce.
In the current situation of the world commodity market and foreign exchange market with many fluctuations, export enterprises must pay attention to the exchange rate between VND and foreign trade payment currencies, in order to choose the market export, import and choose a payment currency that is most beneficial.
The close cooperation of the government, ministries, branches and banks in flexibly directing, implementing prudent monetary policies, adjusting exchange rates, and reasonably stable interest rates is always very necessary for businesses in the current unpredictable situation.
Compiled by Thuy Linh
(seafood.vasep.com.vn) Vietnam's tuna exports reached around $84 million in March 2024, a 17% rise. Vietnam's total tuna export revenue for the first three months of 2024 was $215 million, up 19% from the same time in 2023 but down 17% from 2022. It is anticipated that tuna exports may miss the billion-dollar mark as in 2022 at this rate and the difficulties the business faces.
Vietnam raked in over US$200 million from exporting tuna to 86 markets worldwide during the first quarter of the year, representing a rise of 19% against the same period from last year.
Vietnam’s pangasius export to the United Arab Emirates (UAE) reached more than 7 million USD in the first quarter of this year, a rise of 67% against the same period last year. UAE mainly imported frozen fillets from Vietnam.
(seafood.vasep.com.vn) According to data from General Department of Vietnam Customs, the UK imported nearly $3 million worth of pangasius from Vietnam in the first half of March 2024. Cumulative pangasius exports to this market reached $12 million as of March 15, 2024, down 3% from the same period last year.
Total export revenue from agro-forestry-fisheries products in the first three months of this year is estimated at 13.53 billion USD, up 21.8% over the same period last year; and this results in a trade surplus of 3.36 billion USD, a rise of 96.5%, according to the Ministry of Agriculture and Rural Development (MARD).
The southernmost locality is developing shrimp farming models that generate large outputs but are environment-friendly.
(seafood.vasep.com.vn) An Giang province's aquaculture output is predicted to reach 172.3 thousand tons in the first quarter of 2024, up 6.37% (+10.3 thousand tons) from the same time the previous year.
(seafood.vasep.com.vn) According to data from Vietnam Customs, as of March 15, 2024, Vietnam's cephalopod exports reached more than 109 million USD, a slight decrease of 3% compared to the same period in 2023. In the first quarter of this year, Vietnam's cephalopod exports are expected to reach about 136 million USD, down 2% over the same period last year.
(vasep.com.vn) According to statistics from the International Trade Centre (ITC), Portugal is the 6th largest tuna importer in the EU. In 2023, the country's tuna imports from other countries increased by 9% compared to 2022, reaching nearly 241 million USD.
(vasep.com.vn) Vinh Hoan Corporation has just announced supplementary documents for the 2024 Annual General Meeting of Shareholders, scheduled to be held on April 17.
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