Vietnamese shrimp exports reversed to rise in July 2019

In July 2019, for the first time since the beginning of the year, Vietnam's shrimp export has achieved positive growth. Particularly in July 2019, shrimp export reached over US$334 million, up 13.4% over the same period in 2018.

Prices of raw shrimp and export shrimp no longer dropped sharply as in the first months of the year and tended to go up, market demand was more active as one of the factors that helped Vietnamses shrimp exports grow positively in July, 2019.

In the first seven months of this year, in the structure of shrimp products export of Vietnam, white leg shrimp accounted for 68.2%, black tiger shrimp made up 21.6% and the rest were marine shrimp. Export of white leg shrimp reached US$1.2 billion, down 7% compared to the same period in 2018; Export of black tiger shrimp reached nearly US$ 383.7 million, down 15%; Export of other marine shrimp reached US$ 181 million, up 5%. Export of processed black tiger shrimp dropped the most by 34%. Exported canned marine shrimp increased the most by 57%.

In July 2019, Vietnamese shrimp exports to the top 8 main importers (including the EU, Japan, the US, China, South Korea, Canada, Australia, Taiwan) all grew positively. Notably, shrimp exports to EU and South Korea also recorded the first month of positive growth after recording continuous negative growth since the beginning of this year. Exports to China and the US grew well, reaching the double-digit level.

EU

In July 2019, shrimp exports to EU – the largest shrimp importers of Vietnam was over US$ 77 million, up by 3.8% compared to July 2018. In the three main importers of Vietnam shrimp in the EU (the UK, Germany and the Netherlands), exports to England and Germany went up by 12.9% and 13% respectively, while exports to the Netherlands dropped 12.8%. In the first 7 months of this year, shrimp exports to EU reached US$ 377.5 million, down 21.3% compared to the same period in 2018.

Vietnamese shrimp exported to EU are mainly processed shrimp. For this product, Vietnam has few competitors, mainly Thailand and Indonesia. Processed shrimp have a high tax rate without GSP (from about 10-20%), thus, Vietnamese competitors will be difficult to compete on price. In EU region, the income per capita is high. The more convenient products are, the more popular the market is for Vietnamese shrimp companies to select the seafood distribution systems within their supply.

EU accounted for about 31% of total world shrimp imports and 23% of Vietnamese shrimp exports. If Vietnam can take advantage of tariff preferences, effective application of rules of origin, Vietnam shrimp exports to the EU will have an opportunity to increase from 2020. However, exports to this market in the second half of the year cannot recover.

Japan

Vietnamese shrimp exports to Japan in July 2019 climbed by 2.2%, reaching to nearly US$ 56 million. Shrimp exports to this market increased continuously in the three months of May, June and July although the increase was not much. In the first 7 months of this year, shrimp exports to Japan reached nearly US$ 329 million, down 2.8% compared to the same period in 2018.

Japan remained the second largest shrimp importer of Vietnam in the first 7 months of 2019. Thanks to the advantages from the Trade Agreements between Vietnam and Japan, Vietnamese shrimp exports to Japan in the first half of this year did not drop as deeply as other major markets.

 The US and China

Vietnam shrimp exports to the US in July this year climbed by 37.2% to US$ 77 million. In the first 7 months of this year, shrimp export to this market reached US$ 327.4 million, up 5%.

Demand for US shrimp imports from Vietnam is stepping up due to reducing inventories while the US is also declining imports from India, Thailand and sharply went down imports from China.

Vietnamese shrimp exports to the US is expected to achieve the lowest tax rate in the final result of the 13th administrative review

Vietnamese shrimp exports to China in July 2019 went up by 47.7%, reaching to US$ 51.6 million. In the first 7 months of this year, shrimp exports to this market reached over US$ 285 million, up 1.7% compared to the same period in 2018.

In July 2019, China increased the import of Vietnamese shrimp sharply due to the reduction of imports from other suppliers. The second largest shrimp supplier for China – India is forecast to reduce output this year due to bad weather and shrimp disease. Argentina ranked the fourth in shrimp supply to China announcing to reduce shrimp production due to reduced shrimp biomass in their fishing grounds.