Vietnam seafood exports face major challenges this year

 

 

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), the country's seafood exporters will face two big challenges this year.

 

VASEP general secretary Truong Dinh Hoe said that the IUU regulation set by the EU bloc, the biggest market for Vietnamese seafood, will be the biggest challenge, adding local companies have made good preparations to meet the regulation.

 

Truong also said that local exporters should focus on tra pangasius this year because it is still the key export item to the EU, advising local exporters to pay more attention to fish quality and stable prices.

 

Despite challenges, Vietnamese companies target to raise export revenues by 10% to US$4.3 billion this year.

 

However, Ministry of Agriculture and Rural Development (MARD) deputy minister Luong Le Phuong said that to meet the target; companies should pour more investments to ensure stable material supply.

 

Last year, Vietnam exported US$4.25 billion worth of seafood, down 5.7% from a year earlier.

 

The EU bloc accounted for 25.8% of the Southeast Asian country's total with US$1.096 billion, down 4.2%. Germany, Spain, Holland, Italy and Belgium were the biggest importers of Vietnamese seafood in the bloc.

 

Japan ranked second with import revenues of US$758 million, down 8.5%, and the US ranked third with $713.3 million, down 4.2% from 2008.

 

 

Shrimp export brought in $1.675 billion, up 3% from $1.625 billion in 2008.

 

Meanwhile, seafood exporters are not expecting a prosperous 2010 – despite an upturn predicted for the global economy.

 

According to reports, however, the global economy recovery turns out not to be good news at all, because this means price increases in raw materials. Unprocessed seafood has risen by between 10-15%, while the price of packaging and labour costs have also both increased.

 

One exporter said that the stronger dollar, alongside other hard foreign currencies, is making seafood companies, which mainly make payment in these currencies, suffer.

 

While export prices of finished products have not increased, domestic material prices have increased sharply. Since the beginning of January 2010, tra fish price has increased by VND1,500 (US$0.08) per kilo to VND16,400 (US$0.88) per kilo. Lower farming has led to the lower output and shortage of materials.

 

Reports stated that the demand for tra filet products from the EU and other markets has not shown much improvement. The export price remains at US$2.8-2.9 per kilo. Enterprises cannot raise sale prices because high prices will make them lose orders.

 

Vietnam has set up a target of US$4.5 billion worth of export turnover for seafood products this year, an increase of US$200 million over 2009.