December 22, 2011

After peaking at VND29,500 (US$1.40) per kilogramme of first grade fish in November, Vietnam's Tra fish price just dropped again in December, while Tra fish raw material price has peaked in May and dropped to its lowest in August.

Strangely, when price of Tra fish drop, production factories all experience shortage of raw material. Currently, many factories are only operating at 50-60% of maximum capacity.

Vice Chairman of Vietnam Association of Seafood Exporters and Producers (VASEP) Mr. Duong Ngoc Minh shared, estimated 70% of enterprises are experiencing shortage of raw material.

VASEP Secretary-General Mr Truong Dinh Hoe predicted the current trend of raw material shortage will extend into the first few months of 2012. At the end of July, the price of Tra fish plummeted and fish farmers complained of overstock. Minh also said that the factories lacked raw materials. He later clarified that they were lacking high quality Tra fish. High quality Tra fish has to be raised using proper procedures with standard industrial food. The food used also plays a part in determining the output price, as it makes up 70-75% of the output price.

The seafood industry is one with much frustration and unhappiness right now. Centre of Aquaculture Inspection stated that from 2008 until now, more than 20% of the food samples inspected did not meet the required standards. Prices, on the other hand, increased for seven times in 2011 alone. According to Deputy Minister for Agriculture and Rural Development Mrs Nguyen Thi Xuan Thu, there are too few quality examination and inspection offices for adequate quality control of food for aquatic products. Many processing enterprises complained about the vagueness and lack of clarity of the services market, while fish farmers have to endure high risk.