Seafood exports surge in several markets

Seafood exporting enterprises have been cutting production costs and ramping up their export efforts since the beginning of the year. Photo: T.H.

Exports to China have tripled

As orders rebound, numerous enterprises have accelerated their seafood exports in the early months of 2024. Ms. Lê Hằng, Communications Director of the Vietnam Association of Seafood Exporters and Producers (VASEP), stated that January 2024 saw seafood exports reaching nearly $750 million, marking a 64% increase from the same period in 2023. Ms. Lê Hằng's analysis suggests that apart from the Lunar New Year of 2023 falling in January, January 2024's figures were still approximately 24-25% higher than usual - a genuinely positive indicator for the commencement of the new year 2024. In this context, all major products have shown significant leaps from the previous year: shrimp surged by 71%, pangasius by 97%, tuna by 57%, squid by 45%, and other types of fish by 50%.

Market-wise, the most significant surge occurred in China – Hong Kong, increasing more than threefold. In January 2024, China – Hong Kong emerged as Vietnam's second-largest seafood importing market, trailing only behind Japan. Specifically, in the categories of shrimp and pangasius, China became the largest market this month, with exports to this region nearly quadrupling compared to January 2023. This month also marked an increased purchasing spree by Chinese importers in preparation for the Lunar New Year.

Beyond the Chinese market, seafood exports to numerous other markets also showcased significant growth, such as: the US market increasing by 63%, the Japanese market by 43%, and the EU market by 34%, among others.

Many businesses are currently expressing concern over another potential surge in shipping costs. The global container freight index by mid-January 2024 escalated to $3,407. Despite a 211% rise since October 2023, its last peak was in October 2021, reaching $11,188.60.

Thus, shifting exports towards closer markets like China is becoming a strategic focus for many Vietnamese seafood enterprises.

Facing the challenges ahead

However, when considering the broader market and seafood industry outlook for 2024, the majority of businesses recognize numerous ongoing challenges and difficulties that could slow down the recovery of production and exports.

Some shrimp enterprises have reported that the year's beginning has not yet seen an improvement in orders due to persistent weak demand in the market. Issues such as substantial inventory levels, low purchase prices, and competition challenges with shrimp from India and Ecuador continue to persist.

While some businesses are observing more positive signs regarding orders, they express concerns over raw material sources due to the adverse season and prevalent diseases, resulting in diminished shrimp yields.

Additionally, the potential risk of facing anti-subsidy tariffs is a significant concern for US importers and Vietnamese exporting firms. Vietnamese shrimp's relatively high price compared to other countries is causing hesitation among importers.

In the pangasius sector, there are slightly more positive signs regarding production and market trends. Orders in January and February have shown signs of improvement, leading to an increase in raw pangasius prices from VND 25-26,000 per kg in 2023 to VND 28-29,000 per kg at the beginning of this year. However, importing customers remain cautious about purchase prices. Consequently, pangasius enterprises are hopeful that exports this year will witness a modest increase compared to 2023, potentially reaching an optimistic estimate of $2 billion, a rise of more than 10% from $1.8 billion in 2023.

The seafood and broader aquatic industry are currently navigating through the impacts of several unpredictable global dynamics such as wars, the Russia – Ukraine conflict, Red Sea tensions, and surging freight costs. Specifically, for harvested seafood like tuna, squid, octopus, and various marine fish species, exports have nearly halted due to the IUU yellow card issue and challenges associated with raw material shortages.

Market demand and export prices are expected to incrementally rise, with hopes that Vietnamese shrimp will avoid anti-subsidy tariffs and that the IUU yellow card issue will be resolved. Based on this, businesses are optimistic that exports may improve in the latter half of the year, and the total annual outcome will experience slight growth compared to 2023, aiming for about $9.5 billion.