Vietnam’s Seafood Sector Fears Export Slump

 

Figures from VASEP show the country’s seafood exports reached nearly 166,695 tonnes worth US$579.26 million from the start of the year to March 15, a year-on-year fall of 8 per cent in volume and value. VASEP attributed the drop to lower demand from major consumption markets like the EU, the US and Japan as well as difficulties in getting raw material.

 

Mr Tran Thien Hai, Chairman of VASEP, said local seafood products had been exported to 122 markets, down 37 over last year, with seafood exports to all major markets all going down, except for China, Australia and ASEAN that recorded two-digit growth.

EU is now still the largest importer of Vietnamese seafood, accounting for 26 per cent of the country’s total export revenue. However, the global financial crisis dented the EU demand by 15 per cent to US$150.6 million in the three-month period. Italian and Dutch markets plunged up to 40 per cent. Nonetheless, the EU still made up for nearly a half of Vietnam’s tra catfish export earnings.

 

Japan remains the second largest importer of Vietnam’s seafood which saw a decline of over 9 per cent in the last quarter. Notably, this market accounts for a third of Vietnam’s frozen shrimp export.

 

The share of United States dropped from 16.5 per cent to only 15 per cent because the demand slid more quickly than other markets. However, Vietnam’s tra catfish export to the world’s largest market jumped 131 per cent to US$18 million to become the second largest importer of Vietnamese catfish after the EU.

Mr Hai forecast that Vietnam will earn US$4.5 billion from seafood export in 2009, equal to the amount in 2008. The forecast is based on the demand for the country’s frozen shrimps and tra/basa catfish. Sliding global economies will downsize the demand for Vietnamese food.

 

However, shrimp export was very negative because most markets cut the demand and the US dollar depreciated while exporters could not operate at their full capacity on fears that the decline demand is yet to end, the material supplies are unstable and stockpiles are increasing. Mr Truong Dinh Hoe, General Secretary of VASEP, said from April 1, 2009, the US removed antidumping tax on Vietnamese seafood but Vietnamese shrimp exporters had to place a bond, a kind of security money. Vietnamese shrimp exporters faced many difficulties because of this regulation.

 

Tra and basa catfish export to Russia may face market shut anytime if Vietnamese companies do not change their annoying trading practices. The Farm Bill 2008 of the United States may become an obstacle for Vietnamese tra catfish if the US Department of Agriculture included Vietnamese tra and basa to the catfish list. It means the Vietnamese tra catfish will be put under continuous inspection and supervision of the US. Vietnam is pinning a high hope to export more of this product to the EU, especially Spain, Germany, the Netherlands, Poland, ASEAN and the Middle East.