Seafood export breakthrough, many items recorded record growth

Pangasius and shrimp keep the "billion dollar" growth momentum

By the middle of the second quarter of 2022, in Vietnam's seafood exports, pangasius exports had a remarkable growth with a turnover of over 1 billion USD, an increase of 97% compared to 2021.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), pangasius has had a good export recovery from the advantages of the interrupted supply of white fish from Russia. The largest market group with the growth rate of more than 100% of pangasius in the first 4 months of the year was China and the US with 156% and 136% respectively, followed by the EU market with a growth rate of nearly 85%.

Pangasius products are being exported by Vietnamese enterprises to new markets

In addition, pangasius is being exported to new markets such as Mexico, Egypt and Thailand. Specifically, Mexico is the market with the largest export value of Vietnamese pangasius in the CPTPP market, with more than 50 million USD, an increase of nearly 70% over the same period. The Thai market also increased by 80% with a value of approximately 50 million USD. While exports to Egypt only reached more than 15 million USD, but increased by 85%.

Not only increasing in volume, the export price of pangasius is trending up, exporting to the US is at 4.5 USD/kg, the highest price in the past 3 years.

Faced with such market opportunities, domestic seafood enterprises are boosting production capacity to meet orders.

Nam Viet Corporation said it will recruit about 3,000 more workers to focus on production for pangasius orders to the US. According to Mr. Do Lap Nghiep, Deputy General Director of Nam Viet Group, orders to the US began to be shipped from August this year. Therefore, enterprises focus on raw materials and labor to increase capacity by about 30% and increase by 7-8 tons of raw materials/day.

After pangasius, shrimp is also in the group of seafood products with export value of "billion USD", reaching nearly 1.4 billion USD, up more than 45%, reaching a record compared to the same period in previous years.

Mr. Tran Van Linh, Chairman of the Board of Directors of Thuan Phuoc Seafood and Trading Joint Stock Company said that shrimp products of this company increased by 25% of the total value of orders until the middle of the second quarter of 2022, mainly exported to Europe.

Records from VASEP show that Vietnam's largest shrimp import market group in the first months of the year are countries in the CPTPP, with a turnover of US$405 million, up 36.2%. China is the largest growth market for Vietnamese shrimp in the first months of this year. In April, shrimp exports of enterprises to the Chinese market increased by 148%, bringing the value of the whole 4 months to 187 million USD, an increase of nearly 91%.

The third item with good growth is tuna products. According to VASEP, the growth momentum continued from the last months of 2021, to the middle of the second quarter of this year, tuna exports reached $380 million, up 63% over the same period. The US continues to be the largest market for Vietnamese tuna, accounting for nearly 55%. This is also the market with the highest growth rate in the group of important tuna markets, with a growth rate of nearly 113%.

VASEP assessed the market reality clearly showing the trend of frozen products having a higher export proportion, accounting for nearly 80% and growing by 60% over the same period last year.

"Continuously recording export sales of more than 1 billion USD in March and April, this is the result of the efforts of many businesses. Including the reconnection of trade promotion programs such as: International Seafood Fair in Boston USA in March, Global Seafood Fair in Barcelona (Spain) in April. Through the fairs, it shows that importers' interest in Vietnamese seafood is very high. large", said Mr. Truong Dinh Hoe, General Secretary of VASEP.

Opportunities mixed with challenges

According to VASEP, there are 3 challenges for seafood exports in the last quarters of the year. That is the scarcity of raw materials to ensure export production, increasing freight rates along with increased input costs.

For example, shrimp products, Mr. Tran Van Linh, Chairman of the Board of Directors of Thuan Phuoc Seafood and Trading Joint Stock Company, said that export orders at this time are orders signed before and during the COVID-19 pandemic. Export prices have not yet compensated for the increase in production costs. Therefore, businesses have been negotiating to adjust prices according to the order rate to reduce the burden on businesses.

Shrimp export prices are forecasted to continue to increase, even to skyrocket, especially by the end of the third quarter. However, according to Mr. Linh, the end of the year is the time when the harvest of raw shrimp areas in the country has passed. Therefore, domestic farmers and processing enterprises cannot take advantage of this opportunity.

Along with the scarcity of supply, markets will certainly focus on controlling factors of food safety and traceability. In particular, the "IUU yellow card" that Europe is attaching to seafood products from Vietnam for illegal, undeclared and unregulated fishing is an anti-fishing regulation.

However, seafood exports are opening up growth opportunities. In addition to shrimp, other key products such as pangasius and tuna, VASEP forecasts that the market demand will still be large. In particular, seafood businesses are preparing to reconnect with trade promotion activities and organizations, including VASEP's Vietfish International Fisheries Fair in August 2022. The event is expected to continue to attract more world importers to Vietnam's seafood, which is a lever to boost exports more strongly in the last months of this year.

In addition, opportunities from free trade agreements, especially EVFTA, are becoming a favorable factor for Vietnamese enterprises to obtain competitive prices to boost exports.

"With the current growth rate and context of supply - demand, it is forecast that Vietnam's seafood exports will reach $9.5 - 10 billion in 2022. In which, shrimp exports are forecast to reach about 4.1 - 4.2 billion USD, pangasius will have a profit of 2.4 - 2.5 billion USD, the rest is seafood with about 3.2 - 3.3 billion USD," said Hoe.