December 4, 2008
Vietnam's seafood industry struggles with prices
Seafood companies in Vietnam face difficult times with orders being cancelled, export prices being forced down, and narrowed production scale.
Nguyen Van Thang, Deputy Director of Vimex said that the importers from the US, Middle East and Australia have placed small-sized shrimp orders only, while asking to lower the price by 30 percent.
Thang stated that Vimex has cut down their production capacity by 40 percent and stopped collecting shrimp materials because consumers of importing countries have shifted to eat small-sized shrimp in order to save money. However, it is difficult to find small-sized shrimp at this moment.
All 30 seafood processing companies in Bac Lieu province are facing the same problems. Thang said that he knows some companies have cut down the production capacity by 50 percent, since import demand has been decreasing dramatically from loyal markets. Many US and European partners have also announced the cancellation of their contracts.
Businesses were also affected by capital shortage and high lending interest rates.
Nguyen Huu Dung, Deputy Chairman of the Vietnam Association of Seafood Exporters and Producers (VASEP), said that the seafood export turnover in 2008 would reach US$4.4 billion only, not US$4.5 billion as previously targeted. Dung also said that in 2009, the growth rate of seafood exports will not be higher than 10 percent.