(vasep.com.vn) The local seafood
Malaysia Shrimp Industry Association president Syed Omar Syed Jaafar said domestic fishing vessels and aquaculture farms would need to invest to upgrade their facilities to enable them to comply with EU standards and obtain EU approval.
Following the lifting of almost one-year-old ban on Malaysian seafood to the EU in 2009, seafood that were caught only by EU-approved fishing vessels and raw materials supplied by EU-approved aquaculture farms were allowed to be exported to Europe.
Syed Omar said this involved high cost and those who were reluctant to upgrade would prefer to supply to seafood processing companies that exported to non-EU countries.
“For example, an average size aquaculture farm with about 20 prawn-breeding ponds requires at least RM1mil to RM2mil to upgrade to be compliant with EU standards, depending on the condition of the farms.
“A large fishing vessel requires about RM100,000 to upgrade, depending on the condition of the vessel. Banks are reluctant to lend money to aquaculture farm and fishing vessel owners without strong collateral, as banks regard such business to be of high risk,” he added.
The authorities are in the process of approving 14 more aquaculture farms in the country to supply to the EU market.
“Since there is limited supply of EU seafood raw materials, seafood processing companies are now adjusting their business to focus on exporting to Asian countries, particularly Japan, China, South Korea and Taiwan,” he said.
Malaysian Frozen Food Processors' Association secretary Saw Hai Earn said the shortage of raw materials was still a major problem for seafood companies exporting to Europe.
At present, of the 1,000 aquaculture farms in Malaysia, only 16 are certified to supply to local seafood companies exporting to Europe.
“The alternative is to source the EU-approved raw materials from Indonesia, Thailand or Vietnam. But this is a costly solution as there are logistics and packaging costs which erode margins,” Saw said.
Texchem Resources Bhd chairman Tan Sri Fumihiko Konishi told StarBiz that Europe was a key market for the group previously but now it had to focus on Japan, China and the United States as there was a shortage of EU-approved fishing vessels in the country.
“This results in scarcity of seafood raw materials supply caught by EU-approved fishing vessels, making it difficult for us to source such supplies locally for export to Europe,” Konishi said.
Japan is expected to contribute to 50% of the seafood business of Texchem while China and the United States will generate 15% and 20% respectively. “The growth of China's seafood demand is faster,” he said.
Konishi said the group would not be able to achieve its targeted RM30mil worth of seafood export to China this year, as the catch in Malaysia and Myanmar had been bad. “The bulk of our seafood products to China comprise fishmeal, which had been affected by the poor catch,” he said.
“Over the next three months, the group will increase the export of processed hilsa fish from Myanmar and processed soft shell crabs to China to achieve the targeted export value of RM30mil to the China market in 2012.”
Golden Fresh senior commercial manager Rosy Ng said the company would focus on exporting to Australia, the United States and the Middle East.
“Australia is expected to generate some 50% of the company's revenue compared with about 40% prior to the EU ban on Malaysian seafood in 2008.
“We are still trying to get back our market share in Europe, which is expected to contribute about 20% to the company's revenue this year compared with about 30% before the EU ban in 2008,” she added.
Since July 2010, Golden Fresh had established sales offices in Britain and France, which had boost the contribution of European sales significantly from about 8% in 2009.
Ng said the company was also increasing its range of seafood products with the Marine Stewardship Council eco-friendly certification that rewarded sustainable fishing.