Promote deep processing, increase product competitiveness
According to the Vietnam Association of Seafood Exporters and Producers (VASEP), as of February 15, 2024, Vietnam's shrimp exports to Australia reached more than 23 million USD, an increase of 48% over the same period in 2023. Australia is the fifth largest single market for importing shrimp from Vietnam, accounting for 7.5% of the total value of Vietnam's shrimp exports to markets.
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Australia is the fifth largest single market for importing shrimp from Vietnam.
In 5 years (2019-2022), Vietnam's shrimp exports to Australia have grown continuously from 127 million USD in 2019 to 272 million USD in 2022, with the proportion in Vietnam's total shrimp exports increasing from 3.7% in 2019 to 6.3% in 2022.
Whiteleg shrimp accounts for the largest proportion in the structure of Vietnamese shrimp products exported to Australia, accounting for 95%, black tiger shrimp accounts for a small proportion of 0.2%, and the rest are other types of shrimp accounting for 4.8%.
Of the total shrimp products exported to the Australian market, value-added processed shrimp (HS code 16) accounts for 40% of the total export value of shrimp products to this market. Processed shrimp products exported to this market mainly include shrimp dumplings, ginger shrimp dumplings, frozen breaded fried shrimp, frozen skewered shrimp, etc.
In 2023, Vietnam's shrimp exports to Australia reached 233 million USD, down 14% compared to the previous year. The 14% decline in shrimp exports to Australia is still lower than that of other major markets such as Japan, EU, Korea, Canada, etc.
In 2023, shrimp exports to Australia are part of the general downward trend of shrimp exports to other markets. Australia is also negatively affected by high inflation, which reduces purchasing power.
According to VASEP, although Australia is only the fifth largest shrimp consumer market of Vietnam, it is considered a potential market, especially when the demand for processed shrimp in this market is increasing day by day. Meanwhile, the shrimp processing level of Vietnamese enterprises is constantly increasing, with new products becoming more and more abundant.
By focusing on promoting its strengths, businesses will succeed in large consumer markets, including Australia.
According to Mr. Le Van Quang - General Director of Minh Phu Seafood Corporation, shrimp processing and exporting enterprises must invest in more advanced technology to create more deeply processed, high-value products to conquer the international market.
Mr. Ho Quoc Luc - Chairman of the Board of Directors of Sao Ta Food Joint Stock Company - shared that thanks to investment in modern technology, despite facing strong competitive pressure from cheap shrimp from Ecuador, India and Indonesia, Vietnamese shrimp can still stand firm, even occupying the largest market share in the international market.
Therefore, to maintain its export position and cope with the difference in raw shrimp prices, the Vietnamese shrimp industry promotes its strengths in deep processing and diversifies deeply processed products to maintain market share.
Expected positive results for shrimp exports to the Australian market
Australia is the 13th largest economy in the world with an import turnover of nearly 250 billion USD/year. In recent times, the Vietnam - Australia relationship has continuously developed and become effective in all fields. In particular, economic and trade cooperation has made great strides.
Australia is currently one of Vietnam's 7 largest trading partners, and vice versa, Vietnam is also Australia's 10th largest trading partner.
Vietnam and Australia are common members of at least three free trade agreements (FTAs), including: ASEAN - Australia - New Zealand FTA (AANZFTA), Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and most recently, the Regional Comprehensive Economic Partnership (RCEP).
Although the population size is quite small, only 25.7 million people, this is a potential market because people are willing to pay high prices for quality products and are open to imported goods.
Despite many advantages, Australia is also a demanding market with a strict and stringent system of standards for imported goods. In addition, geographical distance leading to high logistics costs and long transportation times are also a challenge for Vietnamese seafood enterprises when exporting to this market. Therefore, enterprises must be proactive in exploiting and developing the market, and have a long-term business plan to promote the export of goods to the Australian market.
On the occasion of the Special Summit to celebrate the 50th anniversary of ASEAN-Australia relations and the visit to Australia by Prime Minister Pham Minh Chinh in early March, the two Prime Ministers agreed to upgrade the Vietnam-Australia relationship to a Comprehensive Strategic Partnership, equivalent to the relationship between Vietnam and the US, Japan, Russia, India and China. The two sides will promote market access measures and trade facilitation for both countries in the fields of agriculture and fisheries. On the sidelines of the Conference, the Vietnam Trade Promotion Agency and the Australian Trade and Investment Agency signed a Memorandum of Understanding to enhance cooperation in the field of trade and investment promotion between the two countries.
The signing of the Memorandum of Understanding will help the two sides create a stable, sustainable and systematic cooperation mechanism; thereby establishing a plan to implement trade promotion and export promotion activities in the coming time, contributing to promoting the cooperative relationship between the Vietnam Trade Promotion Agency and the Australian Trade and Investment Agency in particular, thereby strengthening the economic and trade cooperation relationship between Vietnam and Australia in general.
According to the Trade Promotion Agency, in 2024, to promote trade promotion activities and export promotion to the Australian market, the Trade Promotion Agency will closely coordinate with the Vietnam Trade Office in Australia in the process of providing updated information on the Australian market situation; opportunities and challenges when exporting to the market. At the same time, recommendations will be made to support Vietnamese enterprises to enhance their capacity, competitiveness, and brands to promote the export of Vietnamese products and goods to the Australian market.
Also within the framework of this Summit, Australia also announced plans to increase investment in Southeast Asia, spending 1.3 billion USD to promote trade in this region with emerging economies.
With positive information in the cooperation relationship between the two sides, the economic situation is gradually improving, it is expected that shrimp exports to the Australian market in 2024 will achieve positive results. Source
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