Seafood farms fail to meet processor demand

Seafood processing plants nationwide have been running at only 40-50 per cent capacity since the start of the fourth quarter, due to a shortage of raw materials, according to the Viet Nam Association of Seafood Exporters and Producers (VASEP).

The Hai Phong Seafood Import-Export Trading company has temporarily halted exports and is importing raw seafood from Taiwan, Japan and South Korea to satisfy the domestic market.

The company’s deputy director Nguyen Tu Quyet said his firm had 20 export contracts for a total of 500 tonnes of seafood which it would not be able to meet due to the shortage.

In the long run, his company was considering importing raw seafood to maintain production. However, this was fraught with difficulties due to the strict quality standards required to satisfy Viet Nam’s customs regulations, he added.

Ha Long Seafood Export Processing Co director Nguyen Huu Mien said his company was importing 500 tonnes of raw materials a month to maintain production.

Explaining the reason, VASEP Deputy Chairman Nguyen Huu Dung said: “A lot of money is needed to run an aquaculture business. After operating at a loss for just one or two harvests, farmers do not want to invest any further.”

The shortage has resulted in a price increase.

On Tuesday, tra fish were being sold for more than VND21 million (US$1,000) per tonne, a month-on-month increase of VND5 million ($256).

The cost of shrimp also increased by 15-20 per cent compared to a month ago.

These increases have forced many exporters to operate at a loss, struggling to meet contracts that were signed several months ago when the price was lower.

Director of An Giang Fisheries Import and Export Joint Stock Company (Agifish) Nguyen Van Ky said his company had only exported small volumes of seafood recently, and may fail to reach its target of $60 million this year due to the shortage.

VASEP said more and more farmers were becoming less inclined to invest in aquaculture, despite the fact the price of seafood products on the world market was increasing.

Farmers were reluctant to take out loans due to high interest rates of up to 17 per cent on top of the increasing cost of feed, VASEP said.

“Farmers in the Cuu Long (Mekong) Delta don’t want to raise tra catfish because the price has remained low since 2008 and the cost of feed keeps increasing,” Dung said.

According to VASEP, the shortage would be difficult to solve in the short term.

The Ministry of Agriculture and Rural Development has asked processors to co-operate with farmers to create a stable supply. — VNS

Tags: Vietnam Seafood, Vietnam seafood sector