Outlook for seafood export in the last months of the year

Vietnamese enterprises lead in deep processing of shrimp exports. Photo: T.H

A ray of light in a gloomy picture

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

Mr. Truong Dinh Hoe, General Secretary of VASEP, said that seafood exports in the first half of 2023 were equal to 2019 levels, but decreased by over US$1.8 billion compared to the previous year. However, in the current difficult context, enterprises should not be too pessimistic, must accept the reality of the market situation so that they had time to prepare, consolidated access to adequate information, better prepared for year-end opportunity.

From a perspective of enterprise, Mr. Ho Quoc Luc, Chairman of the Board of Directors of Sao Ta Food Joint Stock Company, said that the export turnover of the shrimp industry increased very well for several decades, and in 2022, it rose to over US$ 4 billion. The difficulty of shrimp processing enterprises this year included both objective and subjective. Objectively due to inflation and the world economic recession, the sharp decrease of demand, while the supply increased from India; Ecuador which caused an imbalance between supply and demand, so shrimp prices fell.

With subjective reasons, the disease in shrimp farming was quite serious, causing the cost of shrimp farming in Vietnam to increase, unexpected difficulties and combination of both objective and subjective, making it a huge challenge... for shrimp industry.

As forecasted by VASEP, the reality is that seafood exports are recovering with slow speed, it hopes to be better in the last months of the year. There have been many bright spots in the picture of seafood exports, such as: output has increased month by month; the markets began to signal in the settlement of inventories; Along with that, the year-end festival season will increase the demand for seafood. More importantly, the Chinese market is having a stronger consumption power. Hopefully the last few months of the year will be less gloomy.

Leveraging the strength of deep processing

Sharing about the production and processing of shrimp for export, Mr. Le Thanh Hoa, Deputy Director of the Bureau of Processing Quality and Market Development of Vietnam's agricultural products - Ministry of Agriculture and Rural Development said that the whole country had 374 establishments specializing and combining shrimp processing which were eligible to export shrimp to more than 100 markets, with a capacity of over 1.7 million tons of raw materials/year, mainly in the South Central provinces; provinces in the Mekong Delta. This is the strength of this key export industry.

Assessing the processing stage, Mr. Ho Quoc Luc said that the strength of the shrimp industry was good shrimp farming, especially large-sized shrimp. However, large shrimp prices were falling sharply, more than 1/3, because other countries also focused on this strength of Vietnam. “In particular, an important highlight is that the shrimp processing level of Vietnamese enterprises is the highest among other countries, and the level of deep processing in Vietnam is very good. Therefore, in the large market segment, Vietnamese products hold the highest market share. However, competitors are also looking for ways to compete with this product of Vietnamese enterprises, so by all means, we must have a product strategy to have a better leap and sell at a good price”, Mr. Luc shared.

The picture of seafood exports has had a bright spot, but according to experts, enterprises need prepare to accelerate when the market recovers. Firstly, for export, the biggest focus is on raw materials, how to have enough processing materials when the market recovers. Secondly, about the market, continue to keep close contact with importers, keep the market with great demand to boost exports. For the seafood industry, currently the most interested is the Chinese market, which is a key seafood export market. In the first 6 months of 2023, Vietnam's shrimp exports to the Chinese and Hong Kong markets had a decrease of less than half of the general decrease, reaching US$ 280 million, down 15.7% over the same period in 2022. Thirdly, continue to strengthen standards and quality through international certifications.

In addition, enterprises need to calculate market strategies, actively link in the industry, calculate in-depth development, in the direction of a green economy, and produce to meet the requirements of consumers around the world… In the immediate future, they need to focus on preparing to immediately respond to current new trends: environment, society, and governance to enter the world's playing field.

According to VASEP's forecast, in the last months of 2023, inflation, inventory levels will tend to decrease and the demand for year-end holidays will increase, which help to expected seafood export turnover of Vietnam in particular. shrimp products increase again. It is expected that from August onwards until 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. Surely this year seafood export will reach the target of US$ 9 billion.