HCM CITY — Shrimp exports seem unlikely to reach the target of US$2.5 billion this year after falling for two successive months due to rising competition from other countries and increasing costs.
|Shrimp is processed in the southern province of Hau Giang. Shrimp exports are unlikely to reach the target of US$2.5 billion set for this year after declining for two successive months in the face of rising costs and competition from other countries. — VNA/VNS Photo Tran Viet
The Viet Nam Association of Seafood Exporters and Producers (VASEP) reported that July shipments were down 6.8 per cent year-on-year after a 4 per cent fall the previous month.
VASEP now predicts third-quarter exports to be no more than $690 million, or 4 per cent lower than in the same period last year. It will take exports in the first three quarters to $1.7 billion.
VASEP blamed the sluggish exports on pressure caused by competition from other countries and higher input costs together with modest demand in importing countries.
Global shrimp prices are falling but demand in major markets like the US, Japan, and EU is not expected to recover soon due to the tough economic conditions.
Deputy chairman of VASEP Tran Van Linh told the Vietnam Economic Times that Viet Nam was losing its competitiveness despite selling shrimp at very low prices, sometimes as low as the cost of raw shrimp.
At the same time major foreign feed companies, which dominate the domestic market, have been hiking prices, he said.
VASEP said the situation would improve if the Government, in Q3 and subsequently, provided support by cutting interest rates and increasing lending to the industry.
Only a third of seafood producers have been able to keep production unchanged, it said, while the others faced a cash crunch and cannot resume exports without financial support.
Vietnamese shrimp is exported to 62 markets around the world.
Japan is the biggest, followed by the US, EU, and UK.
Exports to most of these markets have been declining.
In the US, Vietnamese shrimp exporters have to compete with those from Thailand, Indonesia, Ecuador, and mainland China. — VNS