VASEP forecast upbeat shrimp export growth for 2018

The Vietnam Association of Seafood Exporters and Processors (VASEP) has projected shrimp exports to continue gathering momentum this year, particularly in the EU and China.

Vietnam’s shrimp export value was estimated at US$3.8 billion in 2017, up 22% from 2016.

The EU was the top importer of Vietnamese shrimp, totaling more than US$780 million worth of the country’s shrimp products in the first eleven months of 2017, 22.2% of Vietnam’s total shrimp export revenue in the period and an annual increase of 42.4%. The Netherlands’ imports grew 70.5%, the strongest growth among the three major EU markets for Vietnamese shrimp products, followed by the UK (54.5%) and Germany (5.9%). 

VASEP General Secretary Truong Dinh Hoe attributed the outcomes to preferential treatments offered by the EU to some Vietnamese shrimp products under the Generalised System of Preferences (GSP). Thailand and China do not have this advantage, he said.

Vietnam’s biggest competition in the bloc are India and Ecuador, he noted, adding that Indian shrimp exports to the EU might fall and face a ban due to antibiotics problems. Vietnamese products could be a potential replacement, he said.

According to Hoe, to capitalise on the EU’s preferential import tariff, Vietnamese exporters have chosen domestic materials and invested more in intensive processing for better value added.

Exporters said Vietnamese shrimp’s big win in the EU last year came from consumers’ preference for convenient seafood products and higher demand during the year-end holiday season. Sources of cold-water shrimps saw higher prices and dwindling supply, increasing the bloc’s demand for Vietnamese imports.

The VASEP said the EU-Vietnam Free Trade Agreement, expected to take effect this year, will boost Vietnamese shrimp shipments to the bloc thanks to tariff elimination for a number of products, which are currently taxed at 20%.

Earnings of Vietnamese shrimps exported to China grew 60.2% to reach US$637.9 million between January and November 2017. 

China has witnessed a reduction of domestic shrimp sources due to poor weather and diseases, while demand is rising thanks to the expansion of the middle-income group and tourist arrivals. From December 1, 2017, the country’s tariff on frozen shrimp imports fell to 2% from 5%.

China is forecast to surpass Japan to become the second biggest importer of Vietnamese shrimps in the first quarter of 2018.

Apart from these upbeat signs, difficulties were foreseen in quantity and quality of Vietnam’s shrimp production, with weather and diseases posing significant risks.

Ho Quoc Luc, head of the Sao Ta food company, pointed to small and scattered production models that make it hard to trace origins, while food safety requirements are being tightened in key import markets. 

To fulfill the requirements, Vietnamese exporters must focus on quality assessment of materials, which could cause prices to increase and reduce competitiveness.

In that context, the building of international-standard material areas for shrimp export is key to growing the sector.