March 31, 2020 19:20

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Export by sea:Motivation for businesses during Covid-19 epidemic

19:16 | 24/02/2020

VCN- Export of goods by sea is now being chosen by businesses while road exports are interrupted by the Covid-19 epidemic.

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Sea navigation

On Saturday (February 15), Lien Dai Phat Company carried out procedures to export 30 containers of dragon fruit to the Chinese market through the port of Cat Lai. In previous days, this company made procedures to export dragon fruit to China by sea. Le Quang Trong, Import-Export Department of Lien Dai Phat Company, said that after exporting goods through the land border gates to China was interrupted, the business turned to exports by sea. Since January 10, Lien Dai Phat Company has completed export procedures for more than 500 containers of dragon fruit through Cat Lai port to China.

Mr. Le Quang Trong said Lien Dai Phat Company acts as an export agent of dragon fruit for businesses. Before the outbreak of Covid-19, the company had both completed procedures to export dragon fruit to China via land border gates, and also exported by sea. However, at present, according to the needs of businesses, the company mainly handles export procedures by sea. In the near future, companies will continue to export containers of agricultural products by sea.

Many seafood products and milk are also exported by sea by businesses. The company mainly exports to China by sea, so it is not affected by the customs clearance at border gates.

Aquatic products mainly exported by sea

Under the impact of the Covid-19 epidemic, many businesses have difficulty in exporting goods through border gates with China, including seafood products. However, large enterprises with formal export methods and market diversification should be less affected by restricted exports to China via land border gates.

A representative of Ngoc Diep Seafood Import-Export Company said that before the Lunar New Year, the company has exported a lot of seafood products to other countries, so after Tet, the export quantity is lower. Since January 10, the company has exported only five containers of seafood products, all of which go by sea through the port of Cat Lai. Therefore, the company's export of goods is not affected when some of the border gates adjacent to China are interrupted.

For shrimp products, Mr. Ho Quoc Luc, Chairman of Sao Ta Food Company, a member of PAN Group, said that the output at this time is lowbecause of the end of the crop; shrimp industry does not have many raw materials. Therefore, shrimp export to China is not much. For Sao Ta alone, the Chinese market only accounts for about 0.5 percent, it means that only one container is exported per month, but it goes by official channels.

Mr. Luc said that the demand for Chinese seafood imports may increase, but not too much, because China has food and is stabilizing very well. In addition to pork, China also has large amounts of beef. For seafood, China is a huge exporter, especially tilapia, this amount of fish exists in large countries (due to US tax) to ensure domestic demand.

For pangasius products, according to information from Vinh Hoan Company, China currently accounts for about 15 percent of Vinh Hoan's export.Currently, the company only exports to China through official routes and transportby sea. Therefore, the company's goods are still delivered on schedule and are not affected by the restriction of customs clearance at the border gates. Vinh Hoan is currently the leading enterprise in the pangasius industry with diversified markets. In particular, the US – the market with a high profit margin – is the company's main market.

The Chinese market accounts for 30 percent of Nam Viet Company's export volume, so pangasius exports to China in early 2020 may be slowed by Covid-19. However, this issue is only temporary and the high demand for consumption will grow strongly after this period. Nam Viet said that with 100% autonomy of material, the company has prepared for any sudden changes inmarket demand. Currently China accounts for about 30 percent of ANV production, in addition to ASEAN (20 percent), Europe (14 percent) and Mexico (9 percent).

However, some seafood enterprises are worried because the source of raw materials imported from China may be interrupted, so they are looking towards the source of raw materials and preparing a "contingency scenario" for any sudden changes in market demand.

By By LeThu/Bui Diep