Shortages plague industrial sector

Raw material shortages, for long a problem plaguing the sugar and seafood processing industries, seem to persist this year because of the lack of a master plan for the two industries.

The harvest of the sugarcane crop is expected to begin in September but though the area under the crop has increased, output is likely to be lower due to diseases, drought, and the increased salinity in rivers due to the long drought this year.

“A supply shortfall for sugar production is possible,” warned Nguyen Thanh Long, general director of the Can Tho Sugar Plant.

“In many areas, farmers have to replant the crop.”

As a result, he said that from December to February there will be little cane supplied to sugar plants.

Pham Thi Sum, chairman of the Bien Hoa Sugar Joint Stock Company, concurred, saying: “The situation will be as bad as last year.”

According to the Viet Nam Association of Seafood Exporters and Producers, most seafood processing plants in the Mekong Delta face a severe shortage of raw materials, especially of some major export items like prawn and catfish.

The shortage is unlikely to be relieved in the short term, because of the price volatility, many farmers have given up aquaculture and returned to vegetable farming.

While the area under acquaculture has shrunk as a result, seafood processing plants have been mushrooming.

Furthermore, in the past, enterprises often stockpiled raw materials they bought during the peak harvest season to use year round but due to the economic crisis, companies only stock enough for production.

All this means the seafood industry is unlikely to honour its export contracts or meet the year’s export target of US$4.5 billion, $200 million higher than last year. — VNS

Tags: Vietnam industries, Vietnam industry