Local firms to spend more on unprocessed seafood imports

Other 09:20 29/08/2016
Domestic enterprises will have to import more unprocessed seafood to turn out products for export due to an undersupply at home, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).

VASEP said at a meeting in HCMC on Aug 2nd 2016 that to fulfill export orders, Vietnam last year had to spend roughly US$1 billion importing unprocessed seafood from 84 markets, with shrimp accounting for 40% of the total.

VASEP chairman Ngo Van Ich said importing more unprocessed seafood is essential to realize the export target of US$10 billion by 2020.

The association said climate change has dealt a blow to aquaculture this year. The area under tiger and white-leg prawn farming has been hit hard, leading to a plunge in output. Therefore, many local processors have relied on shrimp from foreign sources.

According to the Ministry of Agriculture and Rural Development, brackish water shrimp output in the Mekong Delta dipped in the first six months, leading prices to go up. Many processing plants ran at 50-60% capacity in the period due to material shortages.

In the second half, shrimp and pangasius output is projected to slide due to unfavorable weather conditions.

The import price of unprocessed shrimp is US$1-2 per kilogram lower than that of local shrimp, so firms will buy shrimp overseas to raise the competitiveness of their products on foreign markets. 

Local seafood companies have imported unprocessed shrimp from India and tuna from the Philippines and Indonesia.

Due to an undersupply of unprocessed shrimp, VASEP has revised down its forecast for shrimp exports by US$300 million to US$3 billion this year.

VASEP secretary general Truong Dinh Hoe was quoted by the Vietnam News Agency as saying that the recent saltwater intrusion would send down shrimp supply in the remaining months of this year.

Hoe said shrimp shipments to the U.S. climbed by 13.8% in the first six months, to China and Hong Kong by 41.8%, and the European Union (EU) by 6.5%.

However, exports fell by 9% a year-on-year from Japan, which made up 17.1% of Vietnam’s total shrimp exports in the first half.

Vietnam accounts for 12.4% of the total shrimp imports into the U.S., ranking fourth after Indonesia, India and Thailand. Exports to the choosy market are expected to jump after the Ministry of Industry and Trade clinched an agreement on anti-dumping duty on shrimp imports from Vietnam with the U.S. Department of Commerce and the U.S. Trade Representative.

This year, Vietnam has sold shrimp to 75 markets, down from 81 in 2015. The top 10 importers are the U.S., the EU, Japan, China, South Korea, Canada, Australia, ASEAN, Taiwan, and Switzerland. These markets account for 95% of Vietnam’s total shrimp exports.

Seafood exports brought US$3.15 billion in the January-June period, up 4% year-on-year. Of the total, shrimp contributed US$1.4 billion, rising by nearly 5% versus the year-earlier period.

Source: thesaigontimes

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