Enterprises take advantage of opportunities to export shrimp

Exports of Vietnam’s shrimp to most of the main markets has increased, Vietnam's shrimp export price has been more positive, so businesses are taking advantage of the opportunity after the Covid-19 pandemic.

Packaging exported seafood. Source: Internet

The main markets increased

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), Vietnam's shrimp exports in April 2020 continued to increase by 5.8% to reach US$244.2 million. In April 2020, Vietnam's shrimp exports to most of the major import markets increased. Prices of raw shrimp and shrimp exports of Vietnam are more positive than previous months. Inventory in big markets is not much. Demand for shrimp in restaurants and hotels decreased but increased in supermarkets and retail systems because of the trend of buying home processors during the Covid-19 pandemic.

Thus, in the first four months of this year, shrimp exports reached US$872.8 million, up 2.9% over the same period in 2019. This is a key export item that increased during the pandemic.

According to VASEP, the fight against Covid-19 in Vietnam has helped Vietnamese shrimp businesses become more competitive than others such as India and Ecuador – countries so far still struggling with Covid-19 and not able to return to normal production.

Japan remained the largest shrimp import market of Vietnam, accounting for 20.7% of the total value of Vietnam's shrimp exports. After a slight decrease in March 2020, in April 2020, Vietnam's shrimp exports to Japan increased by 19% to US$48.6 million. In the first four months of this year, Vietnam's shrimp exports to this market reached US$180.5 million, up 11% over the same period of 2019.

The US is Vietnam's second largest shrimp import market in April, with a turnover of US$158.7 million shrimp products from Vietnam in the first four months of this year, an increase of 17% over the same period last year. Particularly in April 2020, Vietnam's shrimp exports to the US increased by 14% to over US$43.2 million. The US is the only market that recorded positive growth in Vietnam's shrimp imports in the first four months of this year.

Take advantage of EVFTA

Particularly, EU export turnover of shrimp in the first four months of this year decreased by nearly 8%, reaching only US$123 million. However, in April 2020, the two main import markets, the Netherlands and Belgium, had positive growth after declining in March.

With this market, Vietnam has a favorable advantage from the EVFTA, which is currently in the National Assembly for discussion, approval and is expected to come into effect in July. Especially for shrimp products with tax rates that India, Thailand or other countries do not have a competitive advantage, there will be many positive effects. However, potential risk factors remain, so processing, exporting and shrimp farmers need to work closely to overcome difficulties and seize opportunities when the market recovers.

Along with that, in April 2020, China increased shrimp imports from Vietnam for the first time after a continuous decline in the previous three months. In April 2020, Vietnam's shrimp exports to China reached US$39.2 million, up 16.6% compared to April 2019. Vietnam's shrimp exports to this market in the first four months of this year reached US$108.8 million, down 15.5% over the same period last year due to a sharp decline in the first three months.

China's demand for shrimp imports in the second quarter of 2020 is expected to recover as the country has gradually curbed the Covid-19 pandemic, so many Chinese enterprises have returned to production while the domestic supply of Chinese shrimp is limited due to disease in farmed shrimp.

Vietnam’s shrimp exports are forecasted to have many opportunities to export after Covid-19 when the main rivals such as India, Ecuador and Thailand shrimp are delayed by the national blockade order, the order to shift to Vietnam will be more.

The upcoming EVFTA agreement will help the Vietnamese shrimp industry to compete better in Europe, along with low shrimp export tax to the US market, Vietnam's shrimp exports are expected to continue to increase in May 2020.

According to Truong Dinh Hoe, General Secretary of VASEP, in order to create raw material areas for export, the unit has asked the Ministry of Agriculture and Rural Development to provide maximum support for shrimp farmers and marine fishermen.

It can be implemented right from May 2020 to release shrimp and seawater to catch up with the period from July to August 2020 when enterprises have a great opportunity to recover and increase consumption while some competing producing countries have not returned to normal production.