Shrimp prices jumped thanks to clearing the bottlenecks

After many forums and conferences to discuss solutions to solve difficulties for the shrimp industry by the Ministry of Agriculture and Rural Development, the General Department of Fisheries, and the Vietnam Fisheries Association recently, the main bottlenecks in the shrimp value chain are gradually decreasing. Once cleared, shrimp prices in the Mekong Delta would continuously increase in all sizes. This is a positive signal, when the uptrend in prices is likely to continue until the end of the first quarter of 2022 if the COVID-19 epidemic situation is controlled better.

Loss and worries

According to Mr. Vo Quan Huy, Chairman of the Mỹ Thanh Shrimp Association, during the recent period of isolation, both shrimp farmers, agents and processing enterprises were stuck. The main reason is the shortage of labor and the transportation and circulation of materials for farming as well as commercial shrimp consumption. Mr. Ta Hoang Nhiem, Chairman of Bạc Liêu Shrimp Association specifically stated: “On average, an agent’s shrimp pulling team has at least 10 people, sometimes up to 15-20 people so epidemic prevention and control will be very expensive for agents. This has greatly affected the harvest situation as well as the price of shrimp over time, so the price of shrimp sometimes decreased by 40-50% compared to before the epidemic; and the overall average has also decreased by about 20-30%. This makes shrimp farmers confused and worried about whether they should continue farming or not, even though the information from the business is that the world shrimp market is still very good.”

Loss and worries are common sentiments of many shrimp farming households over the past time, although most of them have achieved relatively high productivity and output, as informed by Mr. Chau Cong Bang, Deputy Director of Cà Mau Department of Agriculture and Rural Development. By the end of August, the province’s shrimp production increased by 8.6% over the same period, reaching 137,000 tons. As for Sóc Trăng, although there are still nearly 19,000 hectares of unharvested shrimp, shrimp production by the end of August has also reached 105,000 tons… MSc. Quach Thi Thanh Binh, Deputy Director of Soc Trang Fisheries Sub-Department, said the shrimp crop this year is quite favorable, so the output has increased quite well, but the most worrying thing is that the price of shrimp will fall deeply, which will cause difficulties for the next farming crops.

Shrimp prices rebounded

Currently, the situation of the COVID-19 epidemic in the southern provinces has shown signs of cooling down. Hence, from the beginning of the second week of September, shrimp prices began to show signs of improvement again and almost every day, a price level was established. The new price is higher than the price of the previous day from 2,000 to 5,000 VND/kg depending on the size. More excitingly, in recent days, small-size shrimp also have stronger consumption and started to increase in price. As noted by the reporter of Vietnam Fisheries Magazine, the current shrimp price in Soc Trang is always higher than other provinces in the region because most local businesses are processing value-added products.

Mr. Ho Quoc Luc, Chairman of the Board of Directors of Sao Ta Food Joint Stock Company, said that from August 15, the number of employees working at the company started to increase from 40% and is now nearly 80%. At Vinacleanfood, from 1,200 employees, it now has about 2,000 employees. Similarly, other shrimp enterprises in Sóc Trăng, as well as Bạc Liêu and Cà Mau, all witness an increased number of employees, therefore the demand for raw shrimp also increases. On the other hand, purchasing outside the province is now easier and more convenient because many localities in the region have reduced the anti-epidemic level from Directive 16 to Directive 15.

The increase in shrimp prices is not only due to the clearing of social distancing bottlenecks, but also due to an increase in market demand and especially the pressure of businesses to deliver goods for Christmas and New Year’s holidays. While, the source of shrimp in the Mekong Delta is currently not abundant due to the end of the crop, so according to businesses, there will be a price competition here to collect raw shrimp to ensure adequate and timely delivery. 


Lack of raw shrimp worries

Although it was predicted, the shortage of raw shrimp in the last months of the year, even until the end of the first quarter of 2022, is inevitable. The reason is that shrimp farmers suffered losses in the last farming crop, along with the complicated developments of the COVID-19 epidemic, making them uneasy to continue farming. Mr. Chau Cong Bang said, due to the sharp and prolonged decline in shrimp prices, some farmers did not dare to stock shrimp, leading to the amount of new stocking by the end of August was only 30% compared to the same period last year.

From the beginning of September until now, in addition to speeding up contact with workers in the “green areas” to return to work, seafood enterprises in Sóc Trăng province also increased to other provinces in the region to purchase raw shrimp to ensure sufficient supplies for year-end contracts as well as to have more reserves for the first months of 2022. The long-term preparation for businesses is not superfluous even in the “3 on-spots” implementation phase, some businesses have reduced a part of deep-processed goods, focusing mostly on raw goods for frozen storage in order to increase stockpiles during the period when shrimp prices increase.

The coming wave of competition for raw shrimp will certainly be stronger and more intense, and as shared by a shrimp business in Sóc Trăng, this will be an uncompromising competition. In order to ensure on the one hand the year-end delivery contract signed earlier, on the other hand, it also aims to take advantage of the remaining opportunities of the year to make up for the months of reduced capacity and sales. The fact that shrimp prices are expected to continue to increase and last at least until the end of the first quarter of 2022 is really good news and also a worthwhile opportunity for shrimp farmers to seize market opportunities from now until the end of the first quarter of 2022.

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