The number of orders and the export value of the aquatic products sector have plunged dramatically, though the year-end season usually witnesses a spike in demand.

According to a survey carried out online and in-person by vietnambiz.vn, 71% of some 117 seafood companies said  the aquatic sector will be facing difficulties in manufacturing, processing and exporting in 2023. Meanwhile, 22% of enterprises consider such future hardships serious and the remainder with nearly 7% are optimistic about their sector in the near future.

The plunge in orders is due to foreign exchange rate volatility and monetary tightening.

Other factors such as the global economic downturn and increasing inflation could be attributed to a drop in consumption in the future. Besides, aqua-products exporters will encounter high competition from other exporters like Ecuador and India that export seafood products at more competitive prices.

Another difficulty that will be faced by the majority of Vietnamese seafood enterprises is their limited storage capacity. The situation may get worse, given the increasing inventories in the coming time.

Vietnam’s major aquatic products importers are currently Europe, China, Japan and the U.S. In the coming time, seafood exporters will receive support from relevant agencies to look for more business opportunities in the U.S. market.

According to VASEP, Vietnam’s aqua-products exports are projected to reach over US$10 billion in 2023 given that the market blossoms at the end of the first quarter of next year.

Market likely to return to 1,000 point-level on positive signals
     
The Vietnamese stock market struggled last week as the benchmark VN-Index fluctuated in a large range. Experts said that there are more positive signals supporting the index to recover to the 1,000 point-level.

On the Ho Chi Minh Stock Exchange (HoSE), the VN-Index ended last week with a strong gain of 23.75 points, or 2.51 per cent, to 971.46 points, while the HNX-Index on the Ha Noi Stock Exchange (HNX) rose by 5.55 points, or 2.9 per cent, to 196.77 points.

For the week, however, the VN-Index only added up 0.22 per cent, whereas the HNX-Index gained over 3 per cent.

The VN-Index dropped for the first three consecutive sessions of the week, but rebounded sharply at the end of last week.

Large stocks in banking, securities, and real estate industries were the main driving force for the benchmark’s recovery. The gaining session at the end of the week helped improve investors' sentiment.

The market’s liquidity decreased by 13.7 per cent over the previous week with the average trading value on all three exchanges reaching over VND11.45 trillion a session (US$462.4 million).

Meanwhile, foreign investors continued to be positive contributors, cushioning the market’s bearish trend in the past week as they were net buyers of VND1.6 trillion on HOSE, but down 67.9 per cent compared to the previous week. This also marked their third consecutive week of net buying.

With the developments in the market, Saigon - Hanoi Securities JSC (SHS) said that there were positive signals showing that the market is gradually stabilising and tends to accumulate when the VN-Index successfully reverses the downtrend and continues to fluctuate in a narrow range. It is likely that the market benchmark will break the long-term downtrend in the short term and move into a more active accumulation phase.

On one hand, in international markets, the US Federal Reserve signalled that it would soon slow down the interest rate hike, while the dollar index has continuously gone down recently and has reached a range of 105-106 points, helping ease the pressure on the domestic exchange rate.

On the other hand, in the domestic market, Vietcombank announced that it will reduce lending interest rates up to 1 per cent for customers. And the government is considering solutions to support the real estate market and corporate bonds, such as loosening credit restrictions and, if necessary, amending Decree 65 on corporate bond issuance.

However, the market is still in a downtrend, so shares are likely to witness strong declines and recoveries before stabilising again and entering a new bullish phase. Therefore, the company recommends that investors should not participate in the market with a large proportion during the period and avoid panic buying in rising sessions.

For long-term portfolios, investors should be patient and continue to hold the current proportion of stocks in their investment portfolios because the market has begun to send out positive recovery signals. If buying new stocks, investors should choose stocks that have good fundamentals and growth potential, or are leading stocks in the industry, and tend to recover stronger than the general market.

Similarly, VCB Securities (VCBS) also recommends investors to limit buying in stocks if the market increased sharply, keep the proportion of shares at about 30 per cent of the account to be able to manage risks if the market suddenly face selling pressure.

From a technical perspective, VCBS believes that 970 - 980 point area is still a strong resistance of the market in the short term. If the active buying liquidity is maintained well, helping the general index overcome resistance, the index will be able to extend to 1,000 - 1,020 points. 

Organic farming key to healthy value chains

Organic production can help Vietnam deal with the skyrocketing prices of food, fuels and fertilisers caused by the recent turbulence in different parts of the world, according to Danish Ambassador to Vietnam Nicolai Prytz.

The ambassador was speaking at an experience-sharing seminar on organic production on November 25.

He said the agriculture landscape has been transformed over the last decades with the emergence of new plant varieties, animal breeds, technological innovations and farming techniques.

However, this transformation has come at an expense of negative environmental impacts, including soil degradation, soil pollution, and increasing greenhouse gas emissions.

A shift to sustainable farming such as organic is a solution that not only tackles these challenges but also contributes to countries' efforts towards achieving United Nations' sustainability development goals by 2030.

Nguyen Quoc Toan, director of the Agro Processing and Market Development Authority, said organic production in Vietnam soared from 19,270ha in 2010 to 53,350ha in 2016, securing the third position in ASEAN.

By late 2021, the country had 17,174 organic producers, 555 processing facilities, 60 exporters and 40 importers. There are 32 authorised bodies in charge of organic certification and 102 bodies of registration-code-granting so far.

He underlined several factors that have been holding back organic transition in Vietnam, including the common practice of using inorganic substances in farming, the weak cooperation between firms and farmers, the underdevelopment of the domestic organic market, and the absence of a digital database for agriculture.

He also said the country will push ahead with organic transition in the short term and aims to make the value delivered by each hectare of organic farming 1.8 times higher that of non-organic farming by 2030.

Truong Tuyet Mai, deputy director of the National Institute of Nutrition, asserted that organic foods are better than non-organic foods in terms of proteins, amino acids, and omega-3,6. On top of that, they are much less contaminated by pesticides, mycotoxins and cadmium, and are totally safe to human health.

She said Vietnamese consumers have begun to change their buying habit towards organic foods in recent years for their health benefits. A survey by Vietnam Report Goup in 2019 showed that 51.5 per cent of consumers in HCM City and Hanoi prefer organic foods to other types of foods.

However, there are still some factors that discourage organic consumption, including prices and availability. Organic foods are normally higher in price than non-organic ones, making them less accessible to low-income consumers.

Kirsten Lund Jensen, leader of Organic Department, Danish Agriculture and Food Council, revealed that Danish rules on organic farming are the same as those in other EU-member states.

She said EU regulations have an overall system of farm management and food production that combines best environmental practices, high level of biodiversity, preservation of natural resources and application of high animal welfare standards.

Lise Walbom, CEO of Food Nation, said her company's Insight Report 2022 has a theme regarding health and sustainability.

The report shows that 25% of Vietnamese respondents associate organic with health and 90 per cent with sustainability. Additionally, 43% point to organic foods as a tool to create healthy value chains and 44% point to organic farming for the same reason.

Agro-forestry-fishery exports reach over US$49 billion in 11 months

The export turnover of agricultural, forestry and fishery products in November hit more than US$4.2 billion, bringing the total export value throughout 11 months of this year to over US$49 billion, marking a-year-on-year rise of nearly 12%, according to the Ministry of Agriculture and Rural Development (MARD).

In which, the export value of agricultural products reached more than US$20 billion, while seafood exports hit over US$10 billion and forest products raked in more than US$15 billion.

Three largest export markets of Vietnam during the reviewed period included the US, China, and Japan.

Accordingly, the US market accounted for 25% of the market share; China market was nearly 19%, and Japan held roughly 8%.

During the past 11 months, the agricultural trade balance recorded a surplus of nearly US$8 billion, representing a-year-on-year increase of close to 48%.

Sourcing restrictions to slow wood pellet export

With rising energy costs around the world, the attractiveness of wood pellets as an alternative energy source has surged dramatically during the year, promising enticing export profits, if all requirements are met.

Following high demand in the world market, the prices of wood pellets have increased by 1.4-1.6 times compared to last year, creating opportunities for Vietnam’s wood pellet industry to expand production and export. According to statistics of the General Department of Forestry, the export value of wood pellets continuously increased from $145 million in 2017 to $603 million in the first 10 months of 2022.

With its current growth momentum, the Association of Vietnam Timber and Forest Products (Viforest) forecasts that the export turnover of biomass wood pellets in the whole year of 2022 may reach about $700 million. In the near future, the export of pellets could even reach over $1 billion. Viforest also noted that, in the first months of 2022, some exporters have signed export orders to South Korea for $150-160 per tonne, an increase of about 19.4 per cent compared to the end of 2021. Meanwhile, the export price to Japan fluctuates between $140-145 per tonne, up about 10 per cent.

However, Vietnam “cannot accelerate exports due to the lack of certified wood materials,” said Nguyen Thanh Phong, general director of Phu Tai Bioenergy JSC in Binh Dinh. “FSC certificates need to meet the requirements of markets like Japan, the largest export market of wood pellets. There are even businesses that are not running at full capacity due to insufficient raw materials,” Phong added.

Nguyen Hoang Tan, vice president for Energy Asia at the Swedish CellMark Ltd., just returned to his office in Ho Chi Minh City after a business trip to Quang Ninh. He met pellet producers and discussed cooperation and export opportunities for this product to Europe. “The Russian-Ukrainian conflict caused Europe to lack three million tonnes of pellets,” Tan said.

According to market watchdog Wood Resources International, 40 per cent of wood pellets in Europe are used for residential heating, 36 per cent as feedstock for power plants, and 14 per cent for heating commercial buildings.

Currently, the price of electricity-generating pellets is about $400-450 per tonne and the price of residential heating pellets is about $530-540 per tonne. Meanwhile, Vietnamese pellets costs only around $200 per tonne.

Vietnam’s pellet production and export industry has only been developed for more than a decade, mainly meeting the demand for input materials for the development of bioelectricity in South Korea and Japan. With the trend of green consumption lately, the export of wood pellets is growing strongly thanks to them being considered as an alternative solution to fossil fuels because of low emissions, renewable ability, and low cost.

The Philippines assists in reducing hurdles for Vietnam's cement exports

An agreement to export cement and clinker to the Philippines is a bright spot for the Vietnamese cement industry's demand-supply mismatch.

The signing ceremony took place during National Assembly Chairman Vuong Dinh Hue's official visit to the Republic of the Philippines from November 23 to 25.

Vietnam Cement Industry Corporation (VICEM) and two importers, Fenix Company INT'L INC. and Golden Falcon Trading Corporation are participating in the signing ceremony. The parties agreed to work together to import and export 6 million metric tonnes of VICEM cement and clinker to the Philippines over a 3-year period from 2023 to 2025.

There is a tremendous need for building materials, especially cement, since the Philippine government has been pushing socioeconomic growth via infrastructure projects for the last 2 years. The signing ceremony affords Vietnamese construction material firms the chance to access the Philippine market for the export of building supplies.

In the first 10 months of the year, according to the General Statistics Office, the export production of the whole sector reached approximately 26 million metric tonnes and was worth $1.14 billion, a decrease of 30 per cent in volume and 19.6 per cent in value compared to the same time last year.

VAT reduction should be maintained in 2023: VCCI

The Vietnam Chamber of Commerce and Industry has said that a 2 per cent decrease in VAT should be sustained through next year.

Dau Anh Tuan, deputy secretary general of the Vietnam Chamber of Commerce and Industry (VCCI), said that the tax cut was one of the measures that must be sustained this year.

According to a spokesman for the VCCI, the policy can be rapidly implemented without requiring complex procedures or awaiting document approval.

VAT reduction should be maintained in 2023: VCCI

The VCCI representative provided several justifications for this proposal. In the aftermath of the epidemic, companies and individuals encounter several obstacles. Also, as there is a danger of inflation, this is a constructive move to help lessen that risk.

Third, the evaluation of the impact of the tax reduction policy in 2022 is excellent. In terms of economic recovery and assistance packages, a VCCI spokesperson said that the 2 per cent VAT reduction strategy is the most effective, implemented the quickest, and "after all, companies and people immediately benefit."

Tuan noted that there are other additional solutions, such as commercial banks' 2 per cent loan assistance package, but implementation was delayed and many enterprises have not yet accessed it.

He said the status of Vietnam's budget revenues in 2022 has been fairly favourable, surpassing and exceeding expenditures in a comparatively favourable manner. Specifically, state budget revenues for the first 10 months of 2022 are projected to exceed $59.1 billion, or 103.7 per cent of the forecast and 16.2 per cent more than the same period in 2021.

VCCI officials have acknowledged that the 2 per cent VAT reduction scheme has increased revenue. This indicates that the initial tax cut will lower budget income by more than $500 million, but by stimulating output and spending, citizens will be willing to pay more.

He acknowledged that the previous period had presented the operating systems of businesses with unprecedented challenges. Due to a fear of accountability, many agencies and officials refuse to execute policies, creating roadblocks.

Industrial real estate boasting further room for growth

Vietnam’s industrial real estate sector is growing rapidly, with demand among investors particularly strong.

Thua Thien-Hue People’s Committee and Gilimex Industrial Park (IP) JSC broke ground on the construction of Gilimex IP in the province’s Huong Thuy town on November 11. The venture was approved in March 2021 and covers over 460 hectares, with $113 million in total investment and 20,000-30,000 projected employees.

The industrial real estate sector has also been attracting new supply sources. On November 12, investment was approved for developing infrastructure at Hai Long IP in the northern province of Thai Binh. Covering an area of 297ha, the project is funded by Bao Minh IP Infrastructure Investment JSC with total capital of VND2 trillion ($87 million).

Elsewhere, Saigon-Bac Giang IP JSC received approval to expand the 90-ha Quang Chau IP, and many manufacturers registered to rent land plots with a fulfilment ratio of 90 per cent. Foxconn alone has registered to rent a 50-ha land plot for its expanded plant, with capital of $300 million.

Statistics from the Housing and Real Estate Market Management Agency under the Ministry of Construction showed that in the third quarter of 2022, many industrial real estate projects were started, inaugurated, or expanded, such as the Soc Son Clean IP, Dong Anh IP, and Phu Nghia IP.

Meanwhile, Son My I IP in the south-central province of Binh Thuan started construction in September and is one of the first smart and green IPs in the south-central coastal region.

According to the Ministry of Planning and Investment (MPI), in the first 10 months of this year, foreign inflows to real estate continued to surge, with the industry ranking second in the list of industries attracting foreign-invested capital. This hit more than $3.87 billion, against $2.12 billion in the same period last year. Notably, $1.43 billion was newly registered capital and $1 billion added capital.

Director of Haiphong Economic Zones Management Authority Le Trung Kien said, “The existing supply source of IPs in the city does not meet demand. Thus, the city wants to develop an additional 15 IPs by 2025. Currently, the city is concentrating on implementing procedures to establish six new IPs across 2,750ha.”

Statistics published by the MPI’s Foreign Investment Agency showed that processing and manufacturing are taking the lead in foreign investment. In the first 10 months of this year, capital in this sector was estimated at $12.9 billion, accounting for 57.5 per cent of the investment inflow to the country.

CFO Vietnam Summit 2022 discusses transformation in Vietnam

At the latest Vietnam CFO Summit 2022, the largest annual summit of its type, guest speakers, leading industry experts, and accounting and finance professionals in Vietnam presented cutting-edge research and shared innovative practices.

Phan Vu Hoang, former chairman of the ACCA Vietnam Members Committee and Tax partner of Deloitte Vietnam, highlighted that some of the most important soft skills for modern financial professionals include flexibility, adaptability, critical thinking, and business partnering, while the future technical skill set is expected to include budgeting, forecasting, and sustainable reporting featuring ESG criteria.

Meanwhile, Saman Bandara, leader of Forensics and Forensic Technology Practice at EY Vietnam, noted that CFOs should evolve and become inspirational agents for change to drive organisational transformation.

Tran Thi Thuy Ngoc, partner and leader of Sustainability and Climate at Deloitte Vietnam, pointed out some challenges to the preparation and presentation of ESG reports in Vietnam.

Finance professionals also discussed the volatility of the corporate bond market, including bond default risks, bond maturity, and practical solutions to counter potential problems.

Le Khanh Lam, partner of RSM Vietnam, pointed out some significant risks in the modern tax landscape, including global tax changes, transfer pricing, pandemic-related tax risks, digitalisation of tax administrations, taxpayers’ data and document storage, organisation, and supply.

According to Toan Kieu, director of SMC Segment (Microsoft), the implementation of cutting-edge technology would enable CFOs to efficiently enhance a more transparent strategic business plan. Hence, CFOs could provide the business development department with thorough and helpful insights by analysing customers’ data.

Nguyen Thanh Liem, head of Finance at PNJ, has an exclusive financial accounting system which could aid the firm’s long-term development over a period of 5-10 years.

Mekong Delta provinces accelerate seafood exports

Recently, seafood exports in the Mekong Delta have seen many bright spots and impressive growth. Despite a deceleration lately, export enterprises have affirmed that they would strive to overcome difficulties, achieving a seafood export turnover of US$11 billion in 2022 - a record milestone for Vietnam's seafood industry.

Shrimp export is one of the bright spots of many coastal provinces in the Mekong Delta. Mr. Tran Van Lau, Chairman of the People's Committee of Soc Trang Province, said that in three quarters of 2022, the seafood export value (mainly shrimp) in the province had reached nearly $1 billion, becoming a commodity that brought in the highest export value. Currently, Soc Trang Province has 22 seafood processing and exporting factories. Its aquatic products are available in 40 countries and territories, creating jobs for tens of thousands of workers. Similarly, Ca Mau Province's shrimp exports are approaching the $1 billion mark. Specifically, by October 2022, shrimp exports had raked in over $960 million, reaching nearly 90 percent of the plan, up roughly 15 percent over the same period last year. Bac Lieu Province’s shrimp exports hit about $686 million, equaling 76 percent of the plan, up 10 percent over the same period.

Besides shrimp, pangasius exports also grew impressively. According to the Vietnam Association of Seafood Exporters and Producers (VASEP), by the end of October 2022, pangasius exports reached nearly $2.2 billion, an increase of 80 percent over the same period in 2021. Most pangasius businesses saw growth in sales year-on-year, mainly thanks to higher export prices.

The two main export markets of Vietnam's pangasius are China, accounting for 30 percent, and the US, accounting for 23 percent. As for the US market, after a rapid increase in the first half of the year, increased inventories and congestion at import ports have caused the demand of the US market to slump. Meanwhile, exports to the Chinese market have continued to recover strongly because the zero Covid-19 policy has caused the country to face a shortage of food and seafood. In addition, Vietnam has also sharply promoted exports to markets where the country participates in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and some Asian markets, taking advantage of tariffs and geographical factors.

Tools to control corporate bonds must be designed: PM

At a meeting with Ho Chi Minh City on the task of socio-economic development, disbursement of public investment capital, and the progress of key projects, Prime Minister Pham Minh Chinh said that it is necessary to design a tool to control investment activities in corporate bonds.

PM Pham Minh Chinh worked with Ho Chi Minh City on the task of socio-economic development, disbursement of public investment capital, and the progress of key projects in the city on the afternoon of November 27.

The Ministers of Construction, Minister of Science and Technology, Minister of Health, Minister of Transport, and deputy ministers of ministries attended the meeting. On the side of HCMC, there was Mr. Nguyen Van Nen, Politburo Member, Secretary of the HCMC Party Committee; Mr. Phan Van Mai, Member of the Party Central Committee, Standing Deputy Secretary of the HCMC Party Committee, Chairman of the People's Committee of HCMC; deputy secretaries of the HCMC Party Committee, and the representatives of departments and agencies.

At the meeting, Mr. Phan Van Mai, Chairman of the People's Committee of HCMC, proposed to the PM ten important issues, including the expansion of the credit room and the situation of corporate bonds.

Regarding credit and credit limit, Deputy Governor of the State Bank of Vietnam (SBV) Pham Thanh Ha said that credit growth this year was at a high level compared to the same period in previous years. In the past 11 months, the credit growth rate is about 12 percent, the credit balance is about VND10.7 quadrillion, and loans are about 1.7-1.8 times higher than that figure. It is estimated that the credit balance is about VND12 quadrillion this year, and the loan outstanding balance is about VND20 quadrillion. HCMC alone accounts for about 27-28 percent of the whole country.

UK supports Vietnam to develop wind power

The British Embassy in Hanoi has just cooperated with Vietnam Electricity and the National Power Transmission Corporation (EVNNPT) to host the seminar series ‘Experience Sharing from the UK on effectively Operating and Managing the National Electricity Grid’.

The seminar offered a valuable chance for over 200 employees from EVN and EVNNPT to learn from experts in the UK about their experience in managing electricity grids and running offshore wind power projects.

According to Denzel Eades, Chairman of the Working Group on Sustainable Development (British Chamber of Commerce Vietnam), Vietnam has a great potential of becoming one of the world’s leading markets in offshore wind power. Therefore, businesses in the UK are willingly to cooperate and support their Vietnamese partners to turn this potential into the reality.

Fishery export completely recovers after COVID-19: official

Vietnam’s fishery export has completely recovered after the COVID-19 pandemic, reeling in 10 billion USD as of November this year, said General Secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP) Truong Dinh Hoe.

The figure was a record that the sector has achieved after over two decades joining the global market, he noted, adding that the export value is projected to hit 11 billion USD in 2022.

In the 11-month period, most of aquatic products posted double-digit growth in export, at between 18% and 77%. Notably, shrimps and Tra fish earned 4.3 billion USD and more than 2 billion USD, up 30% and over 80% annually, respectively. Meanwhile, the turnover of tuna exceeded 1 billion USD for the first time.

Hoe attributed the remarkable growth to Vietnam’s activeness regarding materials and production.

He suggested setting an export target of 20 billion USD in the time to come, given the world’s tremendous demand.

However, VASEP also forecast challenges facing the sector in the time to come, as the global economy is entering a phase of slowdown and increasing inflation. The sector is likely to experience higher inventory level and fierce competition from competitors offering low cost and prices like India and Ecuador.

First batch of pomelo officially shipped to US market

An initial batch of pomelo originating from southern Ben Tre province was officially exported to the United States on November 28.

A ceremony to mark the event was co-hosted by the Ministry of Agriculture and Rural Development and the Ben Tre provincial administration.

The move comes following nearly six years of negotiations, and Ben Tre is the first locality to export pomelo to the demanding market.

Ngo Tuong Vy, general director of Chanh Thu Fruit Import-Export Group Joint Stock Company, that exported the first batch of pomelo to the US, emphasised that the US strictly controls pest contamination in fruit, a factor which led the firm to take time to train farmers and change farming practice.

The company has initiated plans to improve linkages and introduce pomelos into large supermarket chains throughout the US such as Costco and Walmart, Vy revealed.

According to the Plant Protection Department under the Ministry of Agriculture and Rural Development, Vietnam is home to 105,400 ha of land under pomelo cultivation that yields nearly 905,000 tonnes of fruit annually, opening up bright prospects for the fruit to gain entry into the US market.

Bangladesh explores Vietnam’s rice production for import deal

Bangladesh needs to import rice to meet its local demand, with Vietnam emerging as a potential supplier, Bangladeshi Minister of Food Sadhan Chandra Majumder said during a recent working session with the leadership of the Vietnam Southern Food Corporation (VINAFOOD II).

Majumder said the Bangladeshi delegation had inquired into the rice production capacity of Vietnam and VINAFOOD II, as well as the implementation of a contract between the two sides, during their visit.

Nguyen Huy Hung, chairman of directors’ board of VINAFOOD II, for his part, introduced the company’s production capacity, saying VINAFOOD II owns a network of production facilities mainly in the Mekong Delta region, as well as a string of warehouses that boast a total storage capacity of approximately 1.2 million tonnes of rice.

Under the ongoing memorandum of understanding (MoU) on rice trade between Vietnam and Bangladesh, VINAFOOD II first began to provide rice for Bangladesh in 2011 with 450,000 tonnes, and the figures stood at 250,000 tonnes, 52,500 tonnes, and 230,000 tonnes in 2017, 2021, and 2022, respectively.

Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes