Price of shrimp continues rising

This is expected by seafood processing companies in SócTrăng when talking about the picture of shrimp market until the end of 2019. However, it is not the duty exemption imposed by the US that is affecting the upward trend, but mainly an ongoing need and demand for shrimp from the local market and the rest of the world.

In the first days of September, despite the non-stop rain and storms, the price of shrimp in all sizes increased, especially big size white leg shrimp and black tiger shrimp. According to price figures shown by companies, the price of white leg shrimp size 100 pcs/kg increased by 92,000 dong/kg with the big size ones seeing a sharp jump in the end of August and early September. And yet, there was an acute shortage of this species. General Director of VINA CLEANFOOD Võ Văn Phục said: “The price of white leg shrimp has been rising since August, especially big ones. Shrimp size 35 pcs/kg are sold at 160,000 dong/kg and the bigger they are, the more expensive it will be”.

According to companies, the upward trend of white leg shrimp has resulted from India’s situation when the outbreak of white faeces disease prevented local shrimp from weighing up and resulted in the shortage of this segment in the market. Moreover, the price of big size white leg shrimp is forecasted to keep rising because production of farmed shrimp fails to meet demand, while the need of this species is growing as processing companies are rushing to fulfill their contracts. That’s what really worries the companies because, as in 2018, the market never suffered from any sign of shrimp shortage until September, but this year it is different. The processing factories have seen reduction of shrimp since mid-August.

The companies involved in shrimp processing claimed that since mid-August their sales have reduced 10-15% as compared to the previous month. Last year, there were plenty of squares for stocking shrimp in July and August, leading to abundant production in October. But this year, due to lower price over a long time and forecasts of rain and storms in September, farmers reduced the stocking of shrimp in October, resulting in a slump of production until the end of the year.

Another reason that leads to the increase in local price of shrimp is that some companies buy shrimps for processing and selling to China when China’s shrimp hub, Zhejiang, is suffering from a serious shortage of shrimp, forcing local producers and distributors to boost their imports from other countries, including Vietnam.

Even though the price of shrimp raw material is increasing, companies realize that the export price is just inching up with 50 cent/kg. Meanwhile, from now till the end of the year, companies must fulfill their signed contracts and their scrambling for shrimp raw material may push the price to hit a record, leaving further challenges for themselves.

The ongoing situation of the market and positive forecast of shrimp prices until the end of the year may create a good chance for shrimp farmers. But the problem is whether farmers grab it or have to wait because besides favorable conditions of price they will face difficulties in weather, disease outbreak, and capital.