27/03/2024

As the main export product of Vietnamese seafood, shrimp processing enterprises are taking advantage of export acceleration since the beginning of the year.

Many opportunities offered from the Australian market

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), as of February 15, 2024, Vietnamese shrimp exports to Australia reached more than 23 million USD, an increase of 48% over the same period in 2023. Australia is the fifth largest single market for Vietnam's shrimp imports, accounting for 7.5% of the total value of Vietnam's shrimp exports to markets. In 2023, Vietnamese shrimp exports to Australia recorded 233 million USD, down 14% year on year. 

The 14% decrease in shrimp exports to Australia was still lower than other main markets such as Japan, EU, Korea, and Canada. In 5 years (2019-2022), Vietnamese shrimp exports to Australia witnessed the constant growth from 127 million USD in 2019 to 272 million USD in 2022 with the proportion of Vietnam's total shrimp exports increasing from 3.7% in 2019 to 6.3% in 2022.

White-legged shrimp accounted for the largest proportion of Vietnam's shrimp product structure exported to Australia, accounting for 95%, black tiger shrimp accounts for a small proportion of 0.2%, while the rest types accounted for 4.8%. Of the total shrimp products exported to Australia, value-added processed shrimp accounts for 40% of the total export value of shrimp products to this market. 

Processed shrimp products exported to this market mainly include shrimp dumplings, ginger shrimp dumplings, frozen white shrimp with fried flour, frozen white shrimp on skewers. Despite being in the fifth largest shrimp consumption market in Vietnam, Australia is considered a potential market, especially when the demand for processed shrimp in this market is increasing. 

Meanwhile, the shrimp processing level of Vietnamese enterprises is constantly well- qualified, with more and more abundant new products. Australia is currently one of Vietnam's seven largest trading partners; conversely, Vietnam is also Australia's 10th largest trading partner. Currently, Vietnam and Australia are common members of at least three free trade agreements (FTAs), including ASEAN - Australia - New Zealand FTA (AANZFTA), Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Pacific (CPTPP) and most recently the Regional Comprehensive Economic Partnership (RCEP). 

Besides advantages, Australia is also a demanding market with the strict standard system for imported goods. In addition, geographical distance leads to high logistics costs and long shipping times, which are a challenge for Vietnamese seafood businesses when exporting to this market. Therefore, businesses must be proactive in exploiting and developing markets, and have long-term business plans to promote exporting goods to the Australian market. 

Focus on deep processing 

According to businesses, they need to focus on promoting their strengths to achieve more success in large consumer markets. Mr. Le Van Quang, General Director of Minh Phu Seafood Group Joint Stock Company, said that shrimp processing and exporting enterprises are required to invest in more advanced technology to create more deep-processed, affordable products to conquer international markets. 

Sharing the same opinion, Mr. Ho Quoc Luc, Chairman of the Board of Directors of Sao Ta Food Joint Stock Company, highly appreciated the effectiveness of modern technology investment. Despite strong competitive pressure from cheap shrimp from Ecuador and India and Indonesia, Vietnamese shrimp can still stood firm, even accounted for the largest market share in the international market. 

Therefore, to maintain its export position and cope with the price difference of raw shrimp, the Vietnamese shrimp industry promotes its strengths in deep processing and diversify deep-processed products to maintain market share. Currently, export shrimp processing enterprises are "holding out" because orders are not like in the heyday. Besides, at this time, although the price of commercial shrimp is not very high, it is still high compared to the selling price. On the other hand, the world shrimp price is too cheap, cheaper than Vietnamese shrimp by over 1 USD/kg of commercial shrimp that leads to the difference price of over 1.5 USD, so it is too difficult to find orders. 

Large markets are affected by exchange rates, especially the denomination of the Japanese Yen at its record rate of 150 Yen/1 USD. This situation makes purchasing power unable to be strong. The FOODEX fair in Japan taking place in early March will probably attract the participation of many Vietnamese shrimp entrepreneurs with many strategies proposed to retain consumers. By providing products that are traditional to the Japanese, well- qualified and politely- designed, which cannot be competed by no other aquatic shrimp markets, Vietnamese businesses are focusing on exporting to this market.

Ms. Tran Thuy Que Phuong, Chief of VASEP Office:

Vietnam's shrimp exports are exposed to slight recovery and growth in 2024, at a level of 10% to 15% because the ongoing recovery of countries in demands and enterprises promote the production of value-added products and deep processing. In addition, the demand for products with protein sources from aquatic products is gradually replacing protein sources from animals, so in the coming time, seafood, especially shrimp, owns potential growth chances.

Regarding markets, the US and China maintain the positions of two largest markets for Vietnamese shrimp exports in 2024, accounting for about 40% to 45% of the industry's export turnover.

Source:Custom News