Godaco exec: Vietnam needs to bring VAP processing home

Jonathan Wilson, executive director of Godaco Seafood, at Seafood Expo Global 2016

Vietnam’s pangasius industry needs to invest in bringing the value-added processing currently done on the fish by importing nations back “home”, said Godaco executive director Jonathan Wilson.

Currently a very small fraction of Vietnam’s pangsaius exports – less than 1% in 2016 – are value-added. However, the UK, US, EU, ASEAN and Middle East countries all do their own value-adding, he noted, during a recent presentation.

Using the UK as an example, Wilson noted that of the roughly 9,000 metric tons it imports, 7,000t the undergoes value-added processing.

77% of that is for retail, and a very large portion by Young’s Seafood.

There are further opportunities in UK foodservice, which may be more suited to Vietnam’s current style of “standard production”, he suggested.

More generally, for all the aforementioned markets, this is an opportunity to produce coated, pan-fried; marinated; or coated, frozen products, he said.

“It’s a chance to move up the value ladder, designing finished products for developed countries, and not selling raw materials only.”

When it comes to US dollars earned per kilogram of pangasius sold, an estimated $1/kg is earned at the farm gate; $3.55/kg for top quality, untreated pangasius fillets; $4/10/kg for breaded and pan-fried product; and $5.10 for marinated products.

With Vietnam moving to a “middle-income” country – and set for a minimum wage hike in 2018 – producing commodity products is getting tougher, he warned.

This is “no longer a frozen fish fillet business – we are in the ‘food’ business,” he said. “The margins are larger. Vietnam panga producers must both create the market and bring back the production to Vietnam.”