Japan’s low shrimp demand to hit Vietnam exporters

Japan’s low demand for seafood and farming products, especially shrimp, in the aftermath of a devastating earthquake and tsunami that hit the country on March 11 will see a sustained downturn for Vietnamese exporters.

Nguyen Viet Cuong, president of Phu Cuong JSC. a large exporter that owns 20 processing plants in the Mekong Delta, said he’s still completing shrimp and fish products for Japan, the U.S. and Europe and accounting for 70% of the total market share.

“Nevertheless, new orders are very slow due to the big slump in demand from Japan after the disaster and fears over radiation leaks from a crippled nuclear power plant,” he said.

Cuong said Japan imports raw materials from Vietnam and other countries and processes them into high-quality products, and then exports them again to choosy markets in the U.S. and Europe. But radiation leaks have halted seafood exports from Japan as foreigners are afraid of contamination risks and this has hampered the demand of raw materials from Vietnam.

The tightening budget of Japanese people is also a factor. Cuong said: “In the meantime, importers have temporarily halted new orders and use products in storage, which is estimated between 80,000 and 100,000 tons,” he added.

An exporter in Ca Mau Province said the supply shortage from Japan has caused turbulence on the global seafood market, especially shrimp. The shortage has pushed shrimp prices in the Mekong Delta to over VND250,000 per kilo.

Meanwhile, the temporary halt in exports to Japan has seen some small companies shift their attention to China, even though there is a high risk in the payment system there.

Japan is the third largest importer of Vietnamese seafood, only behind Europe and the U.S.

In the year to February 15, Vietnam exported 11,227 tons of seafood to Japan, earning US$80 million, down 10% in volume and up 3% in value compared to the same period last year. – Saigon Times

Tags: Vietnam shrimp exports