The primary cause behind the drop in shrimp exports

DNHN - The major cause for Vietnam's shrimp export turnover declining in recent years is the restricted availability of raw materials combined with a weakening market demand.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), shrimp exports hit 2.3 billion USD in the first six months of the year, a 31 per cent increase over the same time the previous year.

However, after expanding by double digits for the preceding five months, shrimp exports had a negative growth (down 1%). Even in July 2022, the market will be tougher since partner import demand is declining and enterprises are severely deficient in raw materials.

According to VASEP, the cause for the raw shrimp scarcity is that the Mekong Delta has severe rain and storms from June until the end of September, making it difficult to care for farmed shrimp.

Because EHP sickness (infection with microspores) currently has no effective cure, several small shrimp farms and homes have temporarily suspended stockings for fear of harm from the beginning of May till today.

To maintain the availability of raw materials shortly, Mr Truong Dinh Hoe, General Secretary of VASEP, proposed that communities act in time to prevent the illness from spreading as well as take certain steps to help farmers. In the long term, each business must take the initiative to balance the supply and demand for raw resources.

According to Mr Dang Ngoc Son, Deputy General Director of Camimex Group (Ca Mau), the most challenging challenge for businesses is a lack of raw resources. Mr Tran Van Linh, Chairman of the Board of Directors of Thuan Phuoc Seafood and Trading Joint Stock Company (Da Nang), expressed similar concerns: "Raw materials are now in limited supply at shrimp processing plants. Even though the corporation has around 2,000 hectares of shrimp farming regions, mostly in Hue and Ben Tre, it only fulfils 30-40 per cent of the need for raw materials for manufacturers; the remainder must be imported from individuals and associated farms areas."

Most shrimp firms are known to be engaged in around 40% of raw materials for export processing, and many businesses are continuing to extend their material regions. Sao Ta Food Joint Stock Company, for example, has recently spent around VND 200 billion to extend 203 hectares of shrimp farming land, with phase 1 likely to be completed this year, in addition to more than 300 hectares of current shrimp farming land.

Phase 2 will be finished by June 2023. Meanwhile, Minh Phu Group is spending more than 2,800 billion VND on the Kien Giang seawater system. The project's purpose is to contribute to the long-term development of industrial shrimp farming, particularly high-tech shrimp farming, in the Long Xuyen Quadrangle.

VASEP has suggested that firms make use of advantageous tariffs from the EU-Vietnam Free Trade Agreement (EVFTA), the Comprehensive Partnership Agreement, and the EU-Vietnam Free Trade Agreement, particularly in light of the drop in demand in certain areas (EVFTA). The Trans-Pacific Partnership (TPP), the UK-Vietnam Free Trade Agreement (UKVFTA)... to boost exports to Australia, Canada, Malaysia, Thailand, China, and the United Kingdom... Furthermore, firms may attend international seafood exhibitions to attract new clients and importers of Vietnamese seafood.

PV (t/h)