August 6, 2024

 

Vietnam's shrimp exports rise amid global competition

Vietnam's shrimp exports saw growth in the first half of this year, but the market is facing increasing competition from other countries, Vietnam News reported.

 

According to the Vietnam Association of Seafood Exporters and Producers (Vasep), the export value of shrimp reached approximately US$1.6 billion in the first six months, marking a 6% year-on-year increase.

 

In June alone, shrimp export value was US$344 million, up 5% from the previous year. Mainland China and Hong Kong, the largest markets for Vietnamese shrimp, showed signs of recovery in imports in June after a decline in May. During the first half of the year, exports to these markets totalled US$328 million, a 17% increase from the same period last year.

 

However, Vietnam's shrimp exports are expected to face pricing pressure by the end of the year, particularly for black tiger shrimp and white-leg shrimp, due to increased competition from producers in Ecuador, India, and Indonesia.

 

The US is the second-largest market for Vietnamese shrimp. In the first half of the year, exports to the US grew by 1% year-on-year to US$303 million. After a decline in May, exports rebounded in June. Despite this recovery, shipping costs have risen significantly, increasing by 40% from May due to conflicts in the Middle East. Vietnamese shrimp is also facing strong price competition from Ecuador, India, and Indonesia in the US market.

 

Vasep anticipates that US demand for Vietnamese shrimp may rise slightly in the third quarter as importers increase purchasing for year-end festivals. Meanwhile, shipments to Japan fell by 3% to US$229 million, and those to South Korea decreased by 10% to US$149 million. In Japan, Vietnam's value-added goods continue to hold a competitive edge over other suppliers such as India and Ecuador. Demand from Japan and South Korea is expected to increase slightly from September to meet year-end needs.

 

For the European Union (EU), shrimp exports showed solid growth in the second quarter following a slow first quarter. Exports to the EU reached US$217 million in the first six months, a 13% year-on-year increase. In June, the export value was US$52 million, up 31%. The EU demand for shrimp imports is expected to continue rising in the second half of the year.

 

However, Vasep warns that Vietnamese shrimp face additional challenges besides price competition from Ecuadorian and Indian shrimp in the US and EU. Disease outbreaks in farmed shrimp could lead to a shortage of shrimp for processing. Companies may be forced to reduce exports to the US, despite its lucrative market, and instead focus on nearer markets such as Japan, South Korea, Australia, and China.

 

In the second half of the year, Vietnamese shrimp markets are expected to experience better conditions, including lower inventory levels, easing transportation difficulties, and a recovery in demand and prices.

 

-      Vietnam News