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Seafood exports slacken due to declining global demand
Seafood exports are hitting lows in the last few months of the year, unlike previous years, due to declining demand from nations around the world.
Typically, starting mid-November every year, importers around the world would up their orders for Vietnamese seafood for consumption at the year’s end and to start stocking up for the coming year, said Truong Dinh Hoe, general secretary of the Viet Nam Association of Seafood Exporters and Processors (VASEP).
This year, however, importers were cancelling contracts in anticipation of further reduced demand by the end of the year due to the world economic downturn, Hoe said.
The US, the third largest seafood export market for Viet Nam, had reduced imports of seafood, because US banks had limited loans for importers, he said.
Luong Le Phuong, deputy minister of Agriculture and Rural Development said, Russia and Ukraine, two large export markets of tra and basa catfish products, had cancelled imports of seafood due to an inability to make payments for the imports.
Domestic seafood exporters are being forced to revise their business plans.
Cong Nguyen Van Thang, deputy director of Vinh Loi Import-Export Joint Stock Company (Vimex), said the company had had difficulty doing business most of this year, but it expects to face even more difficulty at the end of the year.
The company’s import partners in the US, Australia and the Middle East only wanted contracts carried out for small shrimp and to slash the shrimp import price up to 30 per cent, Thang said.
Consumers in those export markets are shifting to eating small shrimp to save money, but it is hard to have enough small shrimp to fulfil those contracts at the moment. This has led Vimex to reduce its operations by 40 per cent.
The same situation faces 30 other seafood exporters in Bac Lieu Province, according to Thang. Some have reportedly had to reduce operational capacity by as much as 50 per cent.
Duong Viet Thang, deputy director of Southern Seafood Ltd Company (South Vina), said through September, South Vina was optimistic about its business success. However, starting in October the company joined the ranks of other seafood exporters feeling pessimistic about the increasingly difficult export situation due to the economic downturn.
In October, South Vina exported 1,624 tonnes of seafood, earning US$3.56 million. But the company’s total export value in November saw a 40 per cent reduction compared with the previous month, Thang said.
At present, South Vina is operating at 70 per cent of its real seafood processing capacity.
Cao Thi Kim Lan, director of Binh Dinh Fishery Joint Stock Company (Bidifisco), said that 30-40 per cent of its seafood importers had cancelled contracts, even when Bidifisco’s exports for those contracts were already being processed or were already being shipped.
Entering this month, Bidifisco might lose as much as 50 per cent of its current contracts, said Lan.
Viet Nam’s seafood industry has earned $4.27 billion from exports so far this year, according to VASEP.
Nguyen Huu Dung, VASEP deputy chairman, said the nation expects to achieve $4.4 billion from exports of seafood for this year, not reaching the initial yearly target of $4.5 billion.
The fisheries sector has forecast a 10 per cent growth rate of exports next year, according to Dung.
Viet Nam News
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