VASEP advocates removing obstacles for seafood businesses

DNHN - VASEP requested to the Prime Minister and the relevant departments and branches that actions be taken to support and direct the eradication of expenses for the business community, particularly seafood and the price of animal feed.

Mr. Nguyen Hoai Nam, Deputy General Secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), VASEP now has 279 member firms and accounts for about 80-83% of Vietnam's total seafood export revenue. Vietnamese seafood has remained competitive over the last two years, ranking third in the world after China and Norway in terms of seafood exports.

For the first time in 20 years, Vietnam's seafood industry saw a record-breaking comeback in the first seven months of this year, exporting $6.7 billion, a 35% increase. Special items include pangasius, Vietnam's principal product, which accounts for 95% of the world's white fish supply, a rise of 80% in the last 7 months. This figure is quite optimistic for the sector. 

This year, Vietnam's seafood sector is expected to break the 10 billion USD export milestone for the first time, with a 12-15% rise over 2021. Aquaculture items such as pangasius and shrimp will account for around 65%, with marine products accounting for approximately 35%.

There is a figure that demonstrates the industry's strength in assisting the government in the past, particularly during the recent tense anti-epidemic era when the international supply chain broke down.

That is, if associated FDI firms have an average export turnover ratio of around 70-84% in the existing structure of Vietnam's exports, domestic enterprises participate in roughly 26-30%. In the seafood business, the number is currently the opposite: Vietnamese firms account for 95% of the total, with just 5% of FDI enterprises participating in the fisheries sector, which is tied to farmers and fishermen.

In the current setting, and for the first seven months of the year, we are dealing with the ramifications of the pandemic; the previously disrupted international supply chains have not yet fully recovered. High inflation, in particular, decreases buying power in places where our seafood is consumed.

Furthermore, commodity prices for the seafood industry are rising, particularly the price of aqua feed. In the first seven months of the year, business results totalled 6.7 billion USD.

It is critical to prioritize macroeconomic stability since the executive instructions of the Government and the Prime Minister in the past, as well as during the most difficult period of battling the epidemic, have demonstrated unity, allowing us to see the bigger picture.

The impact of macroeconomic stability and assistance for firms, production, and business recovery began on August 8, last year, and was followed by Resolution 175 on September 9.

The cycle of fishermen's sea exploitation, followed by processing for export, has swiftly returned, grabbing market prospects. The market space for seafood is still large, and our prospects are numerous, but in the context of sustainable development and competition with many nations, several obstacles are severely influencing the industry's long-term development.

First and foremost, a concerningly high manufacturing cost issue raises product costs and risks diminishing competitiveness. The first is the problem of animal feed, which has increased by nearly 20% on average since the pandemic. The cost of pangasius and shrimp feed accounts for 65-70% of the total cost; the impact is significant.

Second, transportation and labour costs have risen in the last two years for reasons connected to the pandemic, congestion, and now rising fuel prices, so it remains expensive. The price of a container to the US West Coast is presently 400 million VND, while the price to Europe has increased fourfold from 10,000 to 12,000 USD. This has a significant impact, particularly on our frozen business. Other input costs have risen as well, including packaging, chemicals, shipping, and integration.

VASEP requested to the Prime Minister and relevant ministries that actions be taken to promote and direct the reduction of expenses for the business community, particularly fisheries, and in particular the price of animal feed.

PV