Tough times for Vietnamese seafood exporters with drastic decline in demand

Seafood exporters search for new avenues for exports with a decline of orders from traditional partners.

Seafood exporters continue to struggle during the time of the year when they should be busiest, because importing countries are no longer placing hefty orders. ''We are exporting 50 containers of tra fish every month, just half of last year's same period,'' said Tran Van Hai, director of the company Hung Ca in Dong Thap province.

Fellow exporters share his plight and echoed his sentiments. ''Most markets still have not 'revived.' Clients now do not store goods in big quantities anymore,'' said Truong Thi Le Khanh, director of the company Vinh Hoan, which processes and exports pangasius, VietNamNet reports.

Demand from the European Union (EU), the US and the Middle East has dropped dramatically, said Tran Van Linh, director of Thuan Phuoc in Da Nang City. Regardless, he said, his company continues to export seafood to Japan, a market that still shows a high growth rate in part due to the Vietnam-Japan Economic Partnership Agreement.

As the export market narrows and export prices drop, domestic profits are skidding downward. The price of tra fish for processing, for example, is at just USD 0.85 per kilogramme; a kilo of tra fillet fetches USD 2.7, the lowest price in years, in the EU market.

Chairman of the Vietnam Association of Seafood Exporters and Producers (VASEP) Tran Thien Hai worries that shrimp exports will provide the country with just USD 2.6 billion in total revenues - a fall of 20 per cent from last year. This means that total seafood export revenues will drop USD 300 million from last year's USD 4.5 billion.

There seems to be no respite in sight ,as VASEP officials said the complexity of exporting seafood products to the Russian market, open since March, is worsening. Only 39 Vietnamese companies so far have met Russian requirements are able to export their products there.

Also, the European Commission's (EC) new regulations - effective 1 January 2010 - mandate that all seafood exports to the EU must come with a visible certificate on the products' legitimacy. Documents stating the origin of the seafood will also be necessary.

Some hope comes in the form of markets such as the Republic of Korea (RoK), which continues to be Vietnam's main octopus and squid importer, purchasing 2,000 tonnes of seafood last month - a rise of 13.5 per cent. Vietnam has also been boosting exports to Australia, Israel and the Association of Southeast Asian Nations (ASEAN), according to VASEP.