VietNamNet Bridge – The “barefoot billionaires,” who once got rich with farming tra fish, have become moneyless and crippled with debt.

Tra fish turned farmers into billionaires, and then made them moneyless

In 2006-2007, in the southern province of An Giang, there was a very popular statement orally transmitted: “where there is water, there would be gold mines.” Tra farming helped a lot of poor farmers become billionaires just after several farming crops. This prompted not only farmers, but also construction and food companies to farm tra fish. A lot of “big guys” in HCM City with big idle investment capital also flocked to the countryside to farm fish.

However, things are getting quite different. The “barefoot billionaires” now bog down in big difficulties.

A farmer in An Giang province said that a big amount of oversize fish (1.2-1.5 kilo) has not been sold. Seafood companies now only collect 800 gram-1 kilo fish to make fillet products for export. Farmers now have to bargain away the oversize fish, even though at the prices below the production costs, to stop loss.

Every hectare of oversize fish needs 120 million dong for feed every day.

While many processing workshops refuse to buy oversize fish, some seafood companies like Binh An, An Khang in Can Tho City and Van Hung in Soc Trang still bought oversize fish. They bought all the fish farmers had. Of course, farmers were so happy to sell fish, and they did not demand immediate payment.

However, the companies, which have been struggling to survive the difficulties, have been delaying the payment since September 2011. To date, the total unpaid sum of money has reached 300 billion dong.

As such, with the average interest rate of 14 percent per annum, the farmers have lost at least 21 billion dong in interests. Meanwhile, no one thinks the farmers would be able to take back the debt, or in other words, they would suffer complete loss.

Hai Than, a tra fish in Long Xuyen, said he has sold 2.5 hectares of fish, worth 16 billion dong. Meanwhile, the feed and medicine costs for the last 8-month farming alone reached 13 billion dong, which Than borrowed from banks.

Than said that buyers would make payment after 30 days, which means that from the day of delivering fish to the day of getting money, Than would bear the bank loan interests of 300 million dong.

If the buyers pay money as they promise, Than would make a profit of 1 billion dong after eight months of farming. But if the buyers only make payment after four months, Than would not make profit, or even take loss.

“I am a loyal client of banks; therefore, I can access the bank loans easily. However, I have to pay 2 percent a month in interest rate for the loan worth 13 billion dong,” Than said.

He went on to say that since he began farming fish in 1998, he has never taken loss, which helps him easily access bank loans. However, there are numerous farmers who are taking loss.

The “domino effects” in the tra fish farming industry

Nearly all the farmers, who sold fish in big quantities to processing companies like Binh An, cannot farm fish any more now. The ponds have been blocked by commercial banks because the farmers cannot pay debts. Meanwhile, medicine suppliers now do not accept deferred payment. Learning the lesson from Binh An case, they only deliver products when they get money.

Do Xuan Mai, owner of a medicine shop in Long Xuyen district, is now on the tenterhooks because he still cannot get back 4 billion dong from 25 fish farming households.

It’s not clear if Mai can recover the debts. Ten of the households, who owe 1.5 billion dong, have left the villages. Others households have asked for the payment delay.

Quynh Van