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Shrimp prices dropping, but businesses have no money to buy
Black tiger shrimp prices are dropping dramatically in the Cuu Long River Delta, causing farmers to incur heavy losses, while export companies don’t have money to purchase shrimp from farmers.
Huynh Ngoc Tua, Director of the Vinh Loi Import-Export Company (Vimex) in Bac Lieu province, said that in previous years, the company began purchasing material shrimp in March to be used for processing in the following months. However, the situation is quite different this year. Though the shrimp price has been decreasing and become cheap, the company cannot purchase shrimp because it cannot arrange enough capital.
Currently, big-size shrimp (30 units per kilogramme) are selling at VND80,000/kg, or VND10-20,000 lower than the price levels at this time last year.
Tua said that bank loan interest rates have been skyrocketing while export prices have not been increasing due to the global economic crisis. Vimex can only try to avoid losses, while it dares not think of making heavy investment by purchasing material shrimp in big quantities to store.
Tua said that a lot of shrimp farmers in Bac Lieu province want to sell shrimp to Vimex, accepting payments in 1-2 months. However, the company still does not have money to purchase shrimp.
Ngo Van Nga, General Director of Quoc Viet Company Ltd, said that in August, his company exported 800 tonnes of shrimp worth $7.4mil to the EU, Australia and Asian countries, a lower volume than at the same period last year as the demand for shrimp in the two markets has decreased considerably.
Nga also said that shrimp material prices in the Mekong River Delta have been decreasing, but export companies have become exhausted with high input material prices and high bank loan interest rates.
VNN
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