Can Vietnamese shrimp exports hit US$4.2 billion?
Is it possible that Vietnam’s shrimp export value can hit US$4.2 billion USD while the export volume is experiencing a downward trend?
Sharp decline in sales from big markets
According to VASEP, Vietnam’s shrimp exports slightly declined in August by 1.6%, worth US$352.9 million after the July rise. The shrimp export value in the first eight months of 2019 decreased by 7% from last year.
Although the export volume has not risen, the decline is slowing down compared to previous months. The shrimp exports are forecasted to change for the better by the end of the year.
Increasing demands, rising domestic shrimp production, and higher prices in Vietnam and in the world have improved shrimp exports in the last months of the year.
White leg shrimp have accounted for 69% of exports in the first eight months of 2019, compared to black tiger shrimp at 21.1% and marine shrimp at 9.9%. The export value of white leg shrimp has reached US$1.5 billion, down 6% from last year, while black tiger shrimp exports were at US$449.8 million (-15%), and marine shrimp at US$210.2 million (+6). The sales of processed black tiger shrimp saw the sharpest decline with 33%.
The largest importing market of Vietnamese shrimp, the EU, reached US$74.8 million in August 2019, decreasing by 16.3% as compared to the same period last year. Among the biggest importers in the EU countries, England, The Netherlands, and Germany, the sales to Germany increased by 14% while the export volume to England and The Netherlands decreased by 25.8% and 18.3% respectively. The cumulative sum of Vietnamese shrimp exports to the EU reached US$452.2 million in August, down 20.5% from last year.
The EU’s shrimp imports account for 31% of the total import volume of the world and 23% of Vietnam’s shrimp export volume. If companies take advantage of the preferential tariff from the EVFTA between Vietnam and the EU and the effective rules of origin, the Vietnamese shrimp exports to EU countries may rise from 2020. However, there is no sign of recovery by the end of 2019. EU countries are reluctant to buy Vietnamese seafood as they are afraid of being given some fines based on IUU regulations. This reluctance may lead to a decrease in import volume or a decision to halt purchasing any more Vietnamese shrimps.
A jump of the US market
After a growth in July 2019, the sales of Vietnamese shrimp in the US market increased by 3.8% in August, worth US$84.7 million. Shrimp exports to the US have seen four months of consecutive growth after a considerable decline from early 2019. The US has become the second biggest importer of Vietnamese shrimps after EU with total import volume accounting for 19.4% of Vietnam’s exports.
The US is presenting its increasing demand in Vietnamese shrimps while reducing their purchases from India, Thailand and China.
The DOC has just announced its result of the POR13 about the anti-dumping price of Vietnamese shrimp in the US market, with 31 companies being exempted. The result has raised the competitiveness of Vietnamese shrimps over India and Indonesia.
In August 2019, Vietnam’s shrimp exports to Japan reached US$59.2 million (+3.5%), leaving a US$388.2 million worth of total export value by August which was down 1.9% as compared to the same period last year. However, the VJEPA and CPTPP have helped the sales of Vietnamese shrimps to Japan be stable.
According to Minh Phú Seafood Corp, the US has been the major buyer of its shrimps in the last eight months with the export volume reaching nearly US$170 million. The inventory value has decreased by more than 60% in August and there are just few goods left for export. Minh Phú is gathering every source of raw material to fulfil its plan in the next few months.
The advantages from shrimp exports have built up an expected worth of US$4.2 billion in the last months of the year.