October 1, 2012

Vietnam's Q3 shrimp exports may reach US$690 million

Vietnam's shrimp exports in the third quarter are expected to reach US$690 million, up 19% against the second quarter, but 4% down on-year, despite tough international competition.

Vietnam's shrimp exports hit nearly US$2.4 billion in 2011, up 13.7% compared to the previous year. The Vietnam Association of Seafood Exporters and Producers (VASEP) believes that the export volume in 2012 might reach US$2.5 billion, US$100 million higher than in 2011.

They account for 36.9% of total seafood exports, valued at US$1.7 billion in the first nine months of 2012.

This is mainly due to the growing demand overseas. However, to earn an additional export value of US$800 million and fulfil this year's set target, export businesses should co-ordinate efforts in the remaining months of the year. Currently, only 35% of them are financially strong enough to keep their operations purring along.

Despite having an adequate supply of shrimp for processing and export in the third quarter, they will continue to face tough competition from Thailand, India, Indonesia, and Ecuador. Recently, India has loosened regulations on the import of white-legged shrimps to give a boost to their processing capacity.

According to the Food Agriculture Organisation (FAO)'s forecast, Indonesia's production of white-legged shrimps for export will soon reach a higher level than before.

Japan, the US and EU are Vietnam's three major export markets. However, since early this year, Vietnam's shrimp exports to the EU have fallen due to its slow economic recovery. In France, Italy, Belgium, Holland and other countries, one reason for less consumption of shrimp is a price hike in imported seafood.

Shrimp exports to the EU in the last two months showed a sharp decline. By mid-August, they were estimated at US$185 million, down 23.1% from a year earlier. Shrimp exports to the US and Japanese markets also fared no better due to strict requirements for Ethoxyquin content in shrimp products.

Against this backdrop, some businesses have secured a firm foothold in these demanding markets. Agrimexco CaMau, for instance, earned US$8.6 million from exporting 1,200 tonnes of shrimp. Japan and Europe accounted for 70% of the company's total volume of shrimp exports.

To achieve greater market penetration, Agrimexco Ca Mau has strictly controlled the content of Ethoxyquin in their products for export. There is high hope that export businesses will achieve the set target for US$2.5 billion in shrimp revenue this year.