VN shrimp segment above water

Despite the complexities of COVID-19, shrimp exporters and processors still see a bright future ahead thanks to new markets, and boosting exports to traditional markets which have cut imports from China.

shrimp segment above water

Industry leaders are encouraging enterprises to diversify their products to match the demand of consumers. Photo: Le Toan

shrimp segment above water

Vietnam’s total seafood export value fell by 17.7 per cent on-year to $912 million in the first two months of 2020 due to the impact of the novel coronavirus, according to the Vietnam Association of Seafood Exporters and Producers.

The pandemic has greatly affected China, one of Vietnam’s main markets, and caused a strong reduction in seafood exports. However, despite general difficulties in the sector, there is optimism about the future of exported shrimp.

According to statistics released by Sao Ta Foods JSC (FMC), in February, 937 tonnes of processed shrimp were exported, with a revenue of $10.7 million. These figures are 187 tonnes and $8.3 million lower than during the same period of last year.

Ho Quoc Luc, chairman of FMC’s Board of Directors, said, “The company has yet to face any difficulties in exporting products to traditional markets, namely the US, Japan, and Europe. No customers from these markets have raised concerns about the impact of the COVID-19 on their business. Even in South Korea, which makes up 5-6 per cent of the company’s exports, activity has been stable.”

“FMC has made an effort to expand export channels to Australia,” Luc continued. “In order to meet the demand of both traditional and new markets, the company raised new shrimp colonies in 220 existing ponds and accelerated the construction of new ponds so we can start to raise new batches in April this year.”

Luc went on to say that although the company has yet to be affected by the virus, in early March they established a COVID-19 taskforce. “The mission is to raise awareness about the outbreak among staff and develop preventive measures,” he said.

Boosted exports

FMC’s move is an example of how seafood processing companies can see opportunities in these difficult times. Furthermore, according to the Vietnam Association of Seafood Exporters and Producers (VASEP), the US’ decision to increase tax on goods imported from China is also a chance for seafood producers to boost exports to this market.

According to Truong Dinh Hoe, general secretary of the VASEP, at present, 70-80 per cent of Vietnamese exported shrimp is sent to Japan, the US, and Europe, with the remaining 20-30 per cent exported to China and South Korea. The COVID-19 outbreak will encourage large markets to reduce imports from China and increase imports from other countries, including Vietnam.

The expected rise in shrimp exports may be backed up by the statistics. According to the General Department of Vietnam Customs, in January, Papua New Guinea ranked as one of Vietnam’s top 10 largest export markets with a turnover of $2.8 million, up 1,358 per cent on-year and 108 per cent compared to last December.

In the first month of 2020, the US accounted for 20 per cent of Vietnam’s total shrimp export turnover with a total value of $37.9 million, a significant on-year increase. In 2019, the US reported a decrease on the total imported shrimp volume, including a drop in imports from Indonesia, Thailand, and China. Meanwhile, the turnover of shrimp imported from Vietnam – along with India, Ecuador, and Mexico – still rose on-year.

Improving quality

 

Hoe from the VASEP stated that the peak shrimp farming season is usually at the end of June, by when the COVID-19 pandemic may have been brought under control and the market could be vibrant again. “The sooner the outbreak stops, the better the sector’s prospects are,” he said.

Hoe also recommended diversifying products to match consumption demands, saying that, “Fresh and ‘clean’ shrimps are favoured by markets such as the US and Europe.”

While the virus is spreading and impacting numerous areas of the economy, the EU-Vietnam Free Trade Agreement (EVFTA) should prove to be an invaluable tool for the Southeast Asian nation, allowing it to cut taxes and approach new, potentially lucrative export markets and giving it a distinct advantage over competitors such as India and Thailand.

In order to seize this opportunity, Vietnamese businesses must satisfy many requirements relating to technical and quality standards and rules of origin.

“Moreover, they should develop an efficient supply chain in order to ensure food safety and hygiene, and enhance the competitiveness of products,” said the VASEP general secretary.

However, this is not an insurmountable obstacle for Vietnam to overcome. As one of the leading shrimp export companies, shipping thousands of tonnes of shrimp annually, Thai-backed C.P. Vietnam has applied numerous solutions to enhance productivity and improve the quality of shrimp farming to match the requirements of demanding markets, and explore new ones.

In 2019 alone, more than 4,000 new farms were developed and put into operation, following the company’s advanced CPF-Combine shrimp farming model. This remarkable growth expanded the shrimp farming industry by 9,000 households.

The CPF-Combine approach produces organic, safe, and traceable shrimp, utilising baby shrimp imported from the parent company – C.P. Group, new high-quality feed, and advanced technology, resulting in large shrimp and high productivity.

Boonlap Watcharawanitchakul, senior vice president of C.P. Vietnam, said that this provides a sustainable foundation for the company to strengthen output, as well as improve export volume and seize opportunities created by the EVFTA to reach new overseas markets.

After fish fillets, shrimp is the second-biggest seafood product exported by Vietnam to the EU. It makes up 4.3 per cent of the EU market, behind Thailand (4.5 per cent), India (9.1 per cent), and Ecuador (12.4 per cent).

Therefore, as a result of factors like the outbreak, the EVFTA, and significant investment into farming and processing lines, as well as prominent businesses’ experience in entering new overseas markets, the Vietnamese seafood industry is expectedly well placed to make even bigger inroads into the EU and US in the near future. VIR

Kim Huong

Shrimp exporters in Mekong Delta face challenges amid Covid-19 epidemic

Shrimp exporters in Mekong Delta face challenges amid Covid-19 epidemic

Shrimp is a key export item of many provinces in the Cuu Long (Mekong) River Delta, but the Covid-19 epidemic has caused challenges for exporters.  

VN farmers earn high incomes from pineapple, shrimp and rice cultivation on same field

VN farmers earn high incomes from pineapple, shrimp and rice cultivation on same field

Farmers are seeing higher incomes from using the same field to grow pineapple and rice and breed shrimp in Kien Giang Province’s Go Quao District.

 
 

Other News

.
Keeping calm and carrying on: Vietnam sets a coronavirus example
Keeping calm and carrying on: Vietnam sets a coronavirus example
FEATUREicon  21/03/2020 

As much of the western world descends into a COVID-19-induced panic, nations in close proximity to China have remained relatively calm. 

When reform becomes quiet
When reform becomes quiet
FEATUREicon  17/03/2020 

While the movement of reducing administrative procedures and simplifying business conditions in 2018 was described as a ‘big wave’, the activities were just ‘small ripples’ in 2019.

How Vietnam sacrifices economy to protect its people?
How Vietnam sacrifices economy to protect its people?
FEATUREicon  16/03/2020 

Taking tough measures for the safety of people has become the government's top priority.

The credibility of cooperation
The credibility of cooperation
FEATUREicon  15/03/2020 

It may not be hard to discern that through the EU’s defiance towards Italy’s desperate calls for aid and America’s freshly-imposed barriers on its European allies, inter-state cooperation has been lacking in the fight against COVID-19.

Encouraging signs in real estate arena
Encouraging signs in real estate arena
FEATUREicon  13/03/2020 

Despite the COVID-19 outbreak piling pressure on the toughest segments of the real estate market in hospitality, retail, and industrial property, positive signs have also been unearthed.  

The EVFTA’s grand impacts on Vietnam’s industrial sector
The EVFTA’s grand impacts on Vietnam’s industrial sector
FEATUREicon  14/03/2020 

The EU-Vietnam Free Trade Agreement and Investment Protection Agreement raise many hopes for all of Vietnam’s economic sectors. 

Duong opens new chapter for Vietnamese boxing
Duong opens new chapter for Vietnamese boxing
FEATUREicon  14/03/2020 

Vietnam has waited more than three decades to see a Vietnamese fighter qualify for an Olympics and Nguyen Van Duong ended the drought after he secured a Tokyo Olympic slot at the Asia/Oceania Olympic boxing qualifying tournament.

Tailwinds expected via foreign-funded activities
Tailwinds expected via foreign-funded activities
FEATUREicon  13/03/2020 

Exchange-traded fund providers are offering more choices to foreign investors, at a time when portfolio rebalancing and global uncertainties could leave them high and dry.

VN pharma landscape set for shake-up
VN pharma landscape set for shake-up
FEATUREicon  12/03/2020 

Facing significant expansion from multinational corporations, Vietnamese drug giants took a hit in 2019 despite new strategies, signalling an uninspiring outlook for future growth.  

Head in the clouds, Vietnamese engineer reaches for the stars
Head in the clouds, Vietnamese engineer reaches for the stars
FEATUREicon  14/03/2020 

Three mice died and a few hearts sank. It was March, 2015 in Hyderabad, India. When the vital signs went down, Pham Gia Vinh and his team knew the mice would die.

The change of thinking and action in foreign investment cooperation
The change of thinking and action in foreign investment cooperation
FEATUREicon  10/03/2020 

The Politburo has issued Resolution No.50/NQ-TW on August 20, 2019, outlining directions to perfect institutions and policies to improve foreign investment efficiency and cooperation until 2030.

Rules of origin pose questions for sectors jostling for position
Rules of origin pose questions for sectors jostling for position
FEATUREicon  08/03/2020 

Although the free trade agreement between the EU and Vietnam will offer great opportunities for wood investors and exporters, its rules of origin may not provide a big boon to local textile and garment businesses.

Game changer for the energy arena
Game changer for the energy arena
FEATUREicon  07/03/2020 

Vietnam has recently created several favourable policies, including the Politburo’s Resolution No.55-NQ/TW on the orientation of Vietnam’s national energy development strategy to 2030 with a vision towards 2045.

American painter tells colourful stories of Vietnam
American painter tells colourful stories of Vietnam
FEATUREicon  07/03/2020 

After being impressed by the Vietnamese people living in northern Virginia in the US in the early 1990s, Charles Daniel Hambleton, a native of the state, visited Vietnam for the first time.

Your guide to every 2020 V.League 1 club
Your guide to every 2020 V.League 1 club
FEATUREicon  07/03/2020 

The 2020 V.League 1 season is almost upon us and (coronavirus permitting) matches will kick off coming week.

Expat football fans find taste of home with V.League
Expat football fans find taste of home with V.League
FEATUREicon  07/03/2020 

There’s nothing quite like a day out to watch live football. 

Ford expansion’s impact on Vietnam’s vehicle output muted by imports: Fitch Solutions
Ford expansion’s impact on Vietnam’s vehicle output muted by imports: Fitch Solutions
FEATUREicon  04/03/2020 

U.S. automaker Ford Motors’ latest announcement that it intends to expand its Vietnamese plant will provide only a modest boost to the country’s vehicle output over this year and next, according to Fitch Solutions.

Enterprise support around the corner
Enterprise support around the corner
FEATUREicon  03/03/2020 

With the coronavirus epidemic badly damaging business performance and undermining local production, Vietnam will officially launch a major support package to spur on businesses’ performance and ensure economic growth.  

How EVFTA, coronavirus affects Vietnam industrial property?
How EVFTA, coronavirus affects Vietnam industrial property?
FEATUREicon  04/03/2020 

The coronavirus outbreak will certainly have an effect on the global economy in the coming months. Vietnam, with its proximity and close trade and supply relationships with China, is no exception.

Robust growth predicted for Vietnam’s power sector despite near-term headwinds
Robust growth predicted for Vietnam’s power sector despite near-term headwinds
FEATUREicon  04/03/2020 

Fitch Solutions predicted power consumption in Vietnam to grow by an annual average of 6.5% between 2020 and 2029, which still remains one of the fastest growth rates in Asia.

 
 
 
Leave your comment on an article

OR QUICK LOGIN