VietNamNet Bridge – Catfish farmers in the Mekong Delta still incur losses, even though they are supported by the market factors.

The material supplies have become short, while the export markets have warmed up with more orders coming. However, catfish farmers still cannot define the selling prices. It seems that there is no way to live on catfish farming.

Supply short, but catfish farmers still take loss

The supply & demand economic laws seemingly do not exist in the catfish market. Though the supplies are short and seafood processing companies rush to collect materials for processing to fulfill the export contracts, the catfish price still stays below the production cost, about VND21,000-23,000 per kilo. With the selling prices, farmers incur loss.

According to Duong Ngoc Minh, Deputy Chair of the Vietnam Association of Seafood Exporters and Producers (VASEP), 70 percent of catfish farming households have scaled down their farming because of the loss, while 60-70 percent of seafood processing companies reportedly lack materials for processing.

The report of the An Giang provincial Fisheries Association (AFA) also showed the short supply of catfish materials. The total amount of catfish the 8 big seafood companies in the province used in the last week of August was 5,466 tons, a decrease of 431 tons from the week before.

Vietnam’s catfish export turnover by August 15, 2013 had decreased by 1.1 percent in comparison with the same period of the last year with the turnover of $1.055 billion. However, this does not disappoint analysts, who believe that the exports would increase in the coming months, as the world’s demand has increased.

Minh from VASEP, who is also the President of the Hung Vuong Seafood Company, revealed that seafood companies have to refuse some contracts due to the lack of materials.

No way for catfish farmers?

The solutions applied by the Ministry of Agriculture and Rural Development (MARD) could not help save catfish farmers from incurring loss, the thing which has not been settled over the last two years.

In early 2013, catfish exporters reported to the government and MARD that the export markets were narrowed and it was difficult to get orders, which then forced the domestic catfish prices down and put big difficulties for farmers.

MARD organized a lot of meetings and conferences to discuss the solutions to the catfish farming. It then asked to cut down the fish output to VND800,000-900,000 tons per annum from 1.2 million tons.

Nevertheless, though the material supply is short and the export price to the US has increased by $.0.7 per kilo, the catfish price still cannot move up. As such, the principle of “cutting down output to raise selling prices” set by MARD earlier this year cannot help recover the catfish farmers, who have incurred loss for the last two years.

A senior official of the agriculture department in Mekong Delta, who asked to be anonymous, said the catfish price cannot go up because farmers cannot set up the prices. The material collection prices are being controlled by processing companies.

“Enterprises need to share risks and profits with farmers. If not, farmers would give farming, because they can see no way to live on the job,” he said.

TBKTSG