July 23, 2012

US, Vietnam companies collaborate to augment shrimp export revenues

In order to boost shrimp export revenues through a clean shrimp production chain in the Mekong Delta region, the US's National Fish & Seafood Co. has cooperated with Grobest Industrial Vietnam and Minh Phu Seafood Corporation (MPC).

Clean shrimps, to be produced through the chain, are expected to meet requirements of choosy importing markets such as the US, EU, and Japan so as to help local firms gain more export orders, said Le Van Quang, general director of MPC - a leading shrimp exporter.

Shrimp raisers engaging in the chain will be supplied with feeds and technique from Taiwan-invested aquatic feed producer Grobest Industrial Vietnam while MPC pledged to buy their shrimps at prices being VND2,000 (US$0.10) and VND5,000 (US$0.24) a kilogramme higher than the market level for processing.

These processed shrimps will be later bought by the National Fish & Seafood Co., the biggest shrimp trader in the US, the Vietnam newspaper reported on Friday (July 20).

This clean shrimp production chain is one of measures taken by companies to support shrimp raisers in the Mekong Delta, who are being seriously hit by dropping prices at local market and decreased shrimp export revenues.

Falling demand from the global market amid the economic slowdown in the US and EU, together with Japan's restrictions on Vietnam's shrimp products for fear of anti-biotic and Ethoxyquin residues, have hurt local shrimp exports and caused prices of the product to go down.

In recent months, prices of shrimps have fallen to the lowest level in the past two years, the state-run newspaper said.

Shrimp is listed among Vietnam's export staples. The country ships shrimp products to 70 foreign markets, with the US, EU and Japan being the biggest importers. In 2012, it targets to earn US$2.5 billion from shrimp exports, up from US$2.39 billion in 2011.

However, the local shrimp industry is facing a number of challenges, including widespread occurrence of unknown diseases, falling demand from traditional markets, rejection from importing markets due to high residue of antibiotics, and high production costs.