Seafood export prospects in the last months of the year

Vietnamese enterprises are leading in deep processing of shrimp for export. Photo: TH

A ray of light in a dark picture

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), it is estimated that Vietnam's seafood exports by the end of July 2023 will reach nearly 5 billion USD, down 25% compared to the same period in 2022. Of which, the sharpest decrease is still pangasius with 36%, shrimp and tuna down 27% compared to the same period last year. In July 2023 alone, seafood exports are estimated at 830 million USD, down 11% compared to the same period in 2022. Of which, shrimp exports decreased by 10% to about 345 million USD, pangasius reached 150 million USD, down 20%, tuna decreased slightly by 3% and other types of fish decreased by 12% compared to July 2022. From a market perspective, the most obvious recovery signal is in the Chinese market, which increased by 45% year-on-year in July 2023, reaching nearly 180 million USD. Exports to other major markets are still 5%-40% lower than in July 2022.

Mr. Truong Dinh Hoe, General Secretary of VASEP, said that seafood exports in the first half of 2023 will be equal to the level of 2019, but will decrease by over 1.8 billion USD compared to the previous year. However, in the current difficult context, businesses should not be too pessimistic, they must accept the reality of the market situation so that they have time to prepare, consolidate access to complete information, and better prepare for the opportunities at the end of the year.

From a business perspective, Mr. Ho Quoc Luc, Chairman of the Board of Directors of Sao Ta Food Joint Stock Company, said that the shrimp industry's export turnover has increased very well over the past few decades, and in 2022 it has reached over 4 billion USD. The difficulties of shrimp processing enterprises this year include both objective and subjective factors. Objective factors include inflation and the global economic recession, which have caused a sharp decrease in demand, while supply has increased from India; Ecuador, causing an imbalance in supply and demand, causing shrimp prices to decrease.

Due to subjective reasons, diseases in shrimp farming are quite serious, causing the cost of shrimp farming in Vietnam to increase, unexpected difficulties, combined with both objective and subjective factors, creating huge challenges... for the shrimp industry.

As forecasted by VASEP, the current reality is that seafood exports are recovering, albeit at a slow pace, and it is hoped that they will be better in the last months of the year. There have been many bright spots in the seafood export picture, such as: output has increased month by month; markets are starting to show signs of clearing inventory; along with that, the year-end holiday season will increase demand for seafood consumption. More importantly, the Chinese market is having stronger consumption. Hopefully the last months of the year will be less gloomy.

Promoting the strength of deep processing

Sharing about the production and processing of shrimp for export, Mr. Le Thanh Hoa, Deputy Director of the Department of Processing Quality and Market Development of Vietnamese Agricultural Products - Ministry of Agriculture and Rural Development, said that the whole country has 374 specialized and combined shrimp processing facilities qualified to export shrimp to more than 100 markets, with a capacity of over 1.7 million tons of raw materials/year, mainly concentrated in the South Central provinces; provinces in the Mekong Delta. This is the strength of this key export industry.

Regarding the processing stage, Mr. Ho Quoc Luc said that the strength of the shrimp industry is good shrimp farming, especially large shrimp. However, large shrimp prices are falling sharply, by more than 1/3, because other countries are also focusing on this strength of Vietnam. "In particular, an important bright spot is that the shrimp processing level of Vietnamese enterprises is the highest among other countries, and Vietnam's deep processing level is very good. Therefore, in the large market segment, Vietnamese goods account for the highest market share. However, competitors are also looking for ways to compete with this product of Vietnamese enterprises, so by all means, there must be a product strategy to make a leap forward and sell at a good price" - Mr. Luc shared.

The seafood export picture has had bright spots, however, according to experts, businesses need to be well prepared to accelerate when the market recovers. Firstly, for exports, the biggest focus is on raw materials, how to have enough raw materials for processing when the market recovers. Secondly, regarding the market, continue to keep in close contact with importers, maintain markets with high demand to boost exports. For the seafood industry, the most important market is currently the Chinese market, this is a key seafood export market. In the first 6 months of 2023, Vietnam's shrimp exports to the Chinese and Hong Kong markets decreased by less than half compared to the general decrease, reaching 280 million USD, down 15.7% compared to the same period in 2022. Thirdly, continue to strengthen standards and quality through international certifications.

In addition, businesses need to calculate market strategies, actively connect within the industry, calculate in-depth development, follow the green economy direction, produce to meet the demands of consumers around the world... In addition to immediate solutions, businesses need to focus on preparing to immediately meet current new trends: environment, society, governance to enter the world playground.

According to VASEP's forecast, in the last months of 2023, inflation and inventory will tend to decrease and demand for year-end holidays will increase, which will help to increase the export turnover of Vietnam's seafood products, especially shrimp products, again. It is expected that from August onwards to the end of the year, import demand from Vietnam to China will increase again to serve the Mid-Autumn Festival, National Day and year-end festivals. This year, seafood exports will certainly reach the target of 9 billion USD.

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