Việt Nam's seafood industry needs to adapt to market trends

August, 26/2022 - 08:49
After being affected by the COVID-19 epidemic and fluctuations in inflation, the demand and trends of seafood consumption in many markets have changed, necessitating that Vietnamese seafood enterprises must adapt to these market trends, experts said.

 

HCM CITY – After being affected by the COVID-19 pandemic and fluctuations in inflation, the demand and trends of seafood consumption in many markets have changed, necessitating that Vietnamese seafood enterprises must adapt to these market trends, experts said.

This is the opinion of experts at a seminar on demand and trends of the seafood market after COVID-19 organised by the Việt Nam Association of Seafood Exporters and Producers (Vasep) on Wednesday in HCM City.

The COVID-19 pandemic, logistics disruptions due to the Russia-Ukraine conflict and compliance with regulations on illegal, unreported and unregulated fishing (IUU) are challenges facing the seafood industry.

Lê Hằng, VASEP director of communications, said the world seafood market in the past five years has grown by 16 per cent with an annual import turnover of about US$148.5 billion, of which, shrimp accounted for the highest proportion and increased the most (29 per cent), while salmon increased 16 per cent, and demand for tuna was less volatile.

Meanwhile, demand from the Chinese market has jumped 71 per cent over the last five years, followed by the US with an increase of 32 per cent. Most markets increased demand, except for Japan, which decreased by 6 per cent, and Germany, which decreased slightly by 0.6 per cent.

Exporting seafood to the EU market is facing many challenges because each market in the EU bloc has its own requirements. An obstacle for seafood enterprises exporting to the EU is misunderstanding the granting of a certificate of origin and rules of origin, Hằng said.

In addition, inflation is making EU consumers tighten their spending and focus on moderately priced items. The lowest EUR/USD exchange rate in 20 years also makes consumers limit spending. This causes importers to re-negotiate with exporters, which delays imports.

When inflation is too high in many countries and export prices tend to increase, consumers in those countries will tighten their spending and switch to affordable products such as frozen pangasius fillets, fish cakes, and other frozen products, Hằng said.

Other challenges include stricter demands for EU market certification, and environmental and labour requirements, which can be serious problems for Vietnamese seafood producers.

To take full advantage of the EVFTA, VASEP expects more support from the Import-Export Department and the Ministry of Industry and Trade for businesses to make the most of preferential tariffs and apply the rules of origin to reduce obstacles when exporting seafood to the EU market.

The EU used to be Việt Nam's largest pangasius import market, with peak sales of $511 million in 2010, accounting for 36 per cent of Việt Nam's pangasius exports.

Vietnamese pangasius also accounted for 22 per cent of the market share of white fish imported to the EU. Pangasius was considered a competitor to some other white fish species in Europe.

However, in 2021, pangasius exports to the EU reached just over $106 million, accounting for 7 per cent of Việt Nam's total pangasius exports. In the EU white-meat fish import market, Vietnamese pangasius only accounts for 1.6 per cent of market share.

The EVFTA, effective from August 1, 2020, brought excellent prospects for Việt Nam's seafood exports, including pangasius, to this market. Accordingly, the export of pangasius products will receive tax reductions under a three-year roadmap.

Smoked pangasius exports will have tax reductions within seven years from the effective day of the agreement.

However, the advantages of tariffs did not promote an increase in pangasius exports to the EU in 2020 and 2021 because of the pandemic.

In addition, there is compliance with regulations against unreported and unregulated fishing (IUU). Four years since receiving a "yellow card", Vietnamese seafood export volume to the EU market declined by 3 per cent during 2017-2021.

The Government has pledged to come up with appropriate and effective solutions to quickly solve the "yellow card" penalty. Việt Nam can then avoid the risk of receiving a "red card" and enjoy preferential tariffs and institutional changes from the EVFTA.

However, seafood exports to the EU still maintained a growth rate of 28 per cent in July and 39 per cent in the first seven months, to $829 million, compared to the same period in 2021.

Seafood exports to the US in the first seven months reached nearly $1.5 billion, up 31 per cent over the same period last year, Hằng said.

Meanwhile, seafood export value to China in the first seven months grew by 71 per cent to $1 billion. – VNS

 

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