January 25, 2020 21:08

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Vietnam’s shrimp exports to US sharply decline

09:00 | 27/10/2019

VCN – As one of two key exports of Vietnam’s aquatic products, shrimp exports is on the way of decline, making enterprises worried. Vietnam’s shrimp export turnover in 2019 is estimated at about US$3.4 billion, down by four percent than 2018.  

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vietnams shrimp exports to us sharply decline
Vietnam’s processed shrimp products are promoted to the US. Photo:T.H

According to the Vietnam Association for Seafood Exporters and Producers (VASEP), Vietnam’s shrimp exports in September 2019 reached $307.3 million, decreasing 7.4 percent. In the nine months of the year, shrimp exports reached $2.4 billion, down by 7 percent over the same period last year.

On the first half of the year, shrimp output increased, the price of raw material shrimp decreased, shrimp inventories in other markets were significant, and shrimp supply from other countries also raised, making the price of import shrimp in these markets lower than last year. Therefore, shrimp exports continue to decline from last year. This is mainly due to the low export turnover in the first half of the year. In July, shrimp exports were likely recovered, but exports slowed down in August and September

In the first nine months of this year, white-leg shrimp exports accounted for 69.4 percent of Vietnam’s total shrimp exports, black tiger shrimp accounted for 20.9 percent and the rest was marine shrimp. White-leg shrimp exports reached $1.7 billion, down 5.8 percent over the same period last year; black tiger shrimp exports reached $508.2 million, down 16 percent; and marine shrimp exports reached $236.5 million, up 6.3 percent. Exports of processed black tiger shrimps saw the strongest decline of 35 percent. Canned shrimp exports gained a highest increase of 33.5 percent.

In September 2019, shrimp exports to Vietnam's largest market as the EU, reached more than $61 million, down 23 percent compared to September 2018. In the three main import markets of Vietnam shrimps in the EU (the UK, the Netherlands and Germany), exports to the UK and the Netherlands saw a two-digit decline, 37 percent and 32 percent respectively, exports to Germany decreased by 9 percent. In the first nine months of this year, shrimp exports to the EU reached $513.4 million, a year-on-year decrease of 20.8 percent.

The average import price of shrimps in these markets decreased by $1 per kg compared to 2018: in the UK, it decreased from $12 to $11, in Germany, it decreased from $10.8 to $9.8, in the Netherlands, it decreased from $11 to $9.57 per kg. Compared with other countries such as India and China, the import price of Vietnam’s shrimps is still some 15-20 percent higher ($1-2 per kg).

The EU accounts for about 31 percent of the world's total shrimp imports and 21 percent of Vietnam's shrimp exports. According to experts, if Vietnam know how to take advantages of tariff preferences from the EVFTA between Vietnam and the EU and effectively apply the rules of origin, Vietnam's shrimp exports to the EU will increase from 2020. However, the exports to this market in the second half of the year have not yet recovered.

After positive growth from May to August, Vietnam's shrimp exports to the US in September 2019 dropped by 18 percent, reaching $64.7 million. In the first nine months of this year, shrimp exports to this market reached $476.9 million, a year-on-year increase of 1 percent.

The US is still Vietnam's second largest shrimp import market after the EU, accounting for 19.6 percent of Vietnam's total shrimp export value.

In the US market, India is leading the market share (38 percent) but the average price of Indian shrimp in this market plummeted from $10 to $8.6 per kg, while Vietnam’s shrimp price decreased from $12 to $11 per kg and Vietnam's market share fell down from 11 percent to 8.3 percent. Compared to the Asian and the Latin American shrimp supply to the US market, Vietnam’s shrimp prices remain at the highest levels.

Demand for US shrimp imports from Vietnam was more positive from May to August due to a decrease in inventories while the US was also reducing imports from India and Thailand and strongly reducing imports from China. However, the US is applying the Seafood Import Monitoring Programme for seafood imported from Vietnam, including shrimp, which also causes many difficulties for Vietnamese shrimp exporting enterprises to the US.

In Japan, although export volume was stable and the demand of the market did not increase, the average export price declined by $1 per kg from $12 to $11, making the export value to this market decrease. In the first nine months of 2019, Vietnam's shrimp exports to Japan reached $444.7 million, down 1.9 percent compared to the same period last year. Meanwhile, shrimp prices from Thailand and Indonesia were stable at $11 per kg and Indian shrimp prices fell slightly to $9.3 per kg.

Shrimp exports to China increased by 7.2 percent, equivalent to $382.3 million in the first nine months of this year thanks to continuous positive growth from July to September.

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According to VASEP, shrimp exports tend to be more progressive in the US, China and Japan markets in the last months of the year when inventories decreased. However, exports to the EU market in the last months of the year have not recovered. Competition on shrimp prices is still a big pressure for businesses. Vietnam's shrimp exports for the whole year of 2019 are expected to reach about $3.4 billion, down 4 percent compared to 2018.

By Le Thu/ Huyen Trang