Shrimp exports up, but output down

The shrimp price has been skyrocketing, while processing factories cannot purchase enough shrimp and run at just 30-50 percent of capacity. While Vietnam’s shrimp exports have been increasing steadily, its shrimp output is not increasing accordingly.

Exports up

According to the Ministry of Industry and Trade, seafood export revenues in the first four months of 2010 increased sharply by 20.3 percent over 2009 to $1.3 billion. Shrimp remains the key export item among seafood exports.

The ministry warns that it will be difficult to increase seafood export revenue in the time to come, because domestic processing factories lack materials and can meet only 30-50 percent of the demand from processing companies.

In 2009, due to the global economic crisis, seafood export revenue decreased by 6 percent. Meanwhile, shrimp was the only product that increased, by three percent. Economists reported that the increase of shrimp exports in 2009 could help prevent seafood exports from sharp drops.

Truong Dinh Hoe, Secretary General of the Vietnam Seafood Exporters and Producers (VASEP), examined shrimp export prospects in 2010 and cited that production costs of farming and domestic shrimp output, not export markets, will decide the turnover.

Seafood processing companies complain that they lack shrimp materials to process. Due to the shortage, the shrimp price has been escalating, now selling at prices higher by 30-40 percent than late last year.

Shrimp output down

While Vietnam’s shrimp exports have been increasing steadily, its shrimp output has not. In the last five years, shrimp exports have experienced double digit growth each year, but shrimp output has increased much more slowly and and shrimp farming areas have also shrunk.

In 2009, shrimp farming area decreased by 66,000 hectares to 548,000 hectares. Concurrently, more seafood processing factories were established, making the shrimp material shortage more serious.

In the first quarter of 2010, while shrimp exports rose significantly, the total shrimp output increased by only 6.1 percent, pushing prices up.

In the Mekong Delta during the first quarter of 2010, only three provinces saw shrimp farming area increase, including Bac Lieu (+ 12 percent in area and 26 percent in output), KIen Giang (+ 40 percent in area) and Ca Mau (+ 20 percent in output). Other coastal provinces reduced farming area and output.

According to Thoi bao Kinh te Saigon, very few seafood processing factories can control shrimp materials. A shrimp processing factory in Soc Trang province needs 60 tons of shrimp per day, but collects just 5-6 tons.

Why don’t farmers increase their fish farming area and increase shrimp output?

Farming shrimp requires big capital and production costs in Vietnam are higher than other countries in the region. Therefore, farmers cannot make big profits, which explains why many farmers have given up on shrimp and shifted to other kinds of businesses.

Thoi bao Kinh te Saigon

Tags: Vietnam Seafood, Vietnam seafood exports, Vietnam shrimp exports