Vietnam Exports Bounce Back After Hitting the Bottom

10:05:41 AM | 10/12/2023

Vietnam’s export sector has shown positive growth, particularly the export of key products such as rice, footwear, textiles and seafood.

The prospects for Vietnamese seafood exports are more positive in the last months of 2023

According to preliminary statistics from the General Department of Customs, the country’s import-export turnover in August 2023 reached US$62.08 billion, an increase of 8.8% compared to the previous month (equivalent to US$5.01 billion). Of this amount, exports accounted for US$32.76 billion, up 9%, while imports reached US$29.32 billion, up 8.6%.

This indicates that after nearly a year of challenges, Vietnam’s export situation has started to improve, especially for rice, footwear, textiles and seafood - items that contribute significantly to the country’s total export turnover.

Rice exports rise amid global fluctuations

Vietnam’s rice export turnover witnessed a remarkable increase in the first seven months of 2023 compared to the same period in 2022. In 2022, Vietnam’s rice export turnover amounted to US$3.17 billion and ranked 18th among 21 items that each exceeded US$3 billion. However, in the first seven months of this year, rice climbed to 13th among 30 items that each surpassed US$1 billion.

According to the Ministry of Agriculture and Rural Development, Vietnam exported nearly 5.9 million tons of rice in the first eight months of 2023, up by 22% compared to the same period in 2022. This resulted in a turnover of US$3.17 billion, an increase of 36.1%. The largest buyers of Vietnamese rice were the Philippines, China and Indonesia.

The world rice market is expected to continue to fluctuate upward, as some countries have imposed export restrictions amid the global food situation. Specifically, on July 20, India banned the export of non-basmati white rice, which accounts for nearly half of India’s rice exports and about 17% of the world’s total rice exports. On August 25, India further announced the application of a 20% tax on parboiled rice exports and extended the measure to all non-basmati rice (accounting for 25% of India’s total rice exports) until October 16.

These measures were taken by India to control the rise in rice prices and ensure sufficient supply for its domestic market. However, this may reduce India’s rice exports and cause global rice prices to increase further. This indirectly benefits Vietnam’s rice export price. According to the Vietnam Food Association, the global market demand for Vietnamese rice will increase by at least more than one million tons in 2023, compared to the annual average. Therefore, the market situation remains highly positive from now until the end of the year.

Leather, footwear and garment-textile exports surpass the “bottom”

The garment-textile industry faced many difficulties in the first eight months of 2023. According to the General Department of Customs, Vietnam’s garment-textile export turnover during this period reached only US$22.5 billion, down 14.4% from the same period last year. Exports to key markets declined, with the U.S. market registering US$10 billion (a reduction of 22.4%), the EU market reaching US$2.66 billion (a fall of 11.9%), and the Korean market attaining US$2.08 billion (a decrease of 3%).

However, there are signs of recovery and many good growth opportunities for the textile industry. For example, export turnover to the Japanese market reached US$2.58 billion in the first eight months of this year, up by 1.7% compared to the same period last year. Textile export turnover in August 2023 reached US$3.4 billion, which is the highest in the last eleven months and an increase of 5.5%. Moreover, this is the fourth consecutive month that export turnover has increased compared to the previous month.

In particular, exports to the U.S. have shown signs of recovery with export turnover in August 2023 reaching US$1.5 billion, up by 2.3% compared to the previous month.

Mr. Than Duc Viet, General Director of Garment 10 Corporation, stated that 2023 has been a challenging year for Vietnam’s textile and garment industry. Businesses have faced a shortage of orders throughout the first eight months of the year. However, the textile and garment industry is gradually recovering.

Fisheries industry displays positive signs of recovery

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), Vietnam’s seafood exports accumulated to US$5.79 billion in the first eight months of 2023, down by 24% compared to the same period last year. However, when compared to the same period in 2020 and 2021, this figure increased by 11.2% and 4.1%, respectively. Seafood export turnover in August 2023 is estimated to reach US$846 million. While this is still 15% lower than August 2022, it is the lowest negative growth in the past six months and sales were much higher than in previous months. This indicates that the market will be more positive in the last months of 2023.

In August 2023, exports of pangasius recorded the lowest plunge in the last six months. By the end of August, Vietnam had achieved nearly US$1.2 billion from shipping pangasius, down by 34% year-on-year.

Shrimp products have not yet achieved a breakthrough in exports, but sales in the last three months have been significantly higher than in the first months of the year. The U.S. market has demonstrated positive signs, as sales have grown steadily over the months. Shrimp exports to the United States reversed the negative trend of the first six months of the year and registered the first positive growth of 14% in July. Similarly, shrimp exports to China recorded the second consecutive month of positive growth in July, reducing the decline in shrimp exports to this market in seven months to about 9%.

In contrast to shrimp and pangasius, exports of wild-caught seafood products declined moderately, down 15% from the same period last year and maintaining stable monthly sales. The largest seafood consumption market was Japan, accounting for 28.5%, followed by the U.S. with 15%, Korea with 11%, and the EU with 9%.

Tuna products exported to Korea showed a remarkable increase in the first seven months of 2023. According to the statistics, tuna exports to this market rose by 150% compared to the same period in 2022, reaching over US$7 million. This indicates strong demand for tuna products in Korea and a competitive advantage for Vietnamese exporters.

According to VASEP, Vietnam’s seafood export market will experience a more favorable outlook in the final months of 2023, as seafood demand will rise, especially during the festive season of Christmas and New Year.

By Gia Huy, Vietnam Business Forum