Seafood exports up due to shrimp

	Seafood exports to China on the mend
	Pangasius exports will grow thanks to EVFTA
	Increase the value of Vietnamese seafood to the EU

Shrimp export increases

According to the Vietnam Association of Seafood Exporters and Producers, in the first 6 months of 2019, seafood export of the whole country reached US$3.9 billion, down slightly by nearly 2% compared to the same period last year. In July, the export of aquatic products showed positive signs when exporting shrimp and other products increased again, except for pangasius, so the export result in July increased by 9%, leading the total seafood export to reach US$4.7 billion by the end of July 2019, nearly equal to the same period last year.

In July, exports to major markets recovered, especially China increased strongly by 51%, making the first 7 months' results to this market change completely, from 2% reduction after 6 months, after July increasing by nearly 5%.

Except for lower exports to the EU than the same period last year (down nearly 10%), and to South Korea by 3%,other markets grew positively (Japan increased by 11%, America increased by 2%).

Shrimp exports in the first 6 months of this year decreased by 12% compared to the same period last year, reaching US$1.44 billion. In the first half of this year, shrimp production increased, raw shrimp prices decreased, while shrimp stocks in the markets were high, the supply of shrimp from other countries also increased, so the price of imported shrimp in the markets was lower than last year, this meant shrimp export continued its downward trend from 2018.

After a continuous decline in the first months of the year, in July 2019, shrimp exports began to recover with a increase of 13.4%, reaching US$334 million, pushing the value of export in the first 7 months to US$1.77 billion, down 8% compared to the same period last year.

In July, enterprises boosted shrimp export to all major markets, especially the US increased by 37%, China increased by 48% and Australia increased by 56%, so the total export of the first 7 months of the year was also positive. Export to the EU still had a negative growth of 21%, of which exports to major consuming countries in the region such as the UK, Germany and the Netherlands reduced by 5%, 9% and 45%, respectively.Average prices for exporting shrimp to these markets decreased by US$1 per kg compared to 2018.

Thanks to a strong increase in exports in July, shrimp exports to the US market in the first 7 months increased by 5% compared to the same period last year, after decreasing continuously in the first 6 months due to high inventories, the sharp demand decrease compared to the same period, the average import price decreased by US$1.1 per kg over the same period last year.

Shrimp exports to China also increased slightly by nearly 2% thanks to increase of exports in July. In the first 5 months of the year, shrimp export of enterprises through unofficial cross-border trade is still difficult, so raw shrimp prices have not recovered. Currently, China is tightening trade borders and strengthening food safety control, so exporting shrimp across the border is not accepted. Meanwhile, main shrimp export by sea still tends to increase. However, from June, white shrimp export by sea into China increased by 1.5 times compared to the previous month, this trend is forecasted to bring positive results in the last months of the year.

Expect to remove IUU "yellow card"

TheIUU "Yellow Card" has affected the export of seafood products, especially in the first quarter.The issue of certificationof exploited and imported materials is still inadequate, causing exports to stagnate. Exports of tuna to the EU recovered from the second quarter, so the total export of the first half of the year still remained at the same level as last year, while the export of octopus and cuttlefish continued to drop by 14%. However, in July, tuna exports to the EU decreased strongly by 20%, while the export of cuttlefish and octopus increased by 12%. The US market still maintained high growth for tuna export (up 61%), cuttlefish and octopus (up 60%), this is the largest tuna market accounting for 43% of Vietnam's turnover, but only accounting for 2.5% of cuttlefish and octopus export.

Meanwhile, the Japanese market accounts for a large proportion of Vietnam's octopus and cuttlefish (accounting for 26%), second to South Korea (42%) and still increased by 9% of the value of imported cuttlefish and octopus from Vietnam in the first 7 months. Exports of tuna to Japan recovered strongly in July with an increase of 85%, so the results of the last 7 months are nearly equivalent to the same period last year. However, this market only accounts for 3.5% of Vietnamese tuna export value. Exporting octopus and cuttlefish to Korea increased 9%, reaching US$120 million, however, there have been signs of decline in recent months (plummeting nearly 29% in June and continuing to decrease by 12% in July).

In contrast to shrimp, pangasius export continued to decrease by nearly 13% in July, so total export in the first 7 months decreased by 5.5% to US$1.13 billion. Pangasius exports to the US fell sharply in the second quarter (down nearly 42%), dragging the export results of the first half of this year down nearly 28% to US$141 million, due to the impact of CBPG tax in the period POR14. Shrimp exports to the US in July fell further at 56%, making export into this market only reach US$168 million in the first 7 months, down 34%.

Export of tuna will continue to maintain good growth in the second half of the year to the US and China markets. However, it is difficult to predict the EU market because it will depend on the results of EU inspections at the end of October 2019 to assess the implementation of the EU’s anti-IUU recommendations. In the next few months, enterprises may continue to boost exports to this market. If there are positive results after the inspection, export will get stronger, on the contrary, the export turnover of the second half will be equivalent or lower than the same period last year. Export of other seafood products is also dominated by IUU yellow card but enterprises are able to boost to other markets outside the EU, so export can still maintain positive growth in the last months of the year.

Shrimp export is expected to be more positive in the US, China and Japan markets in the second half of the year when inventories decrease, demand increases and shrimp production in India is projected to decrease by 20-30% due to weather effects and lower prices.

Export of pangasius into the Chinese market in the first months of the year was affected by border trade tightening policy and quality control, however, it has increased again since June and it is forecasted that export enterprises as well as Chinese importers catch up with the demand and have better adjustments in the following months, so export will continue to increase more strongly in the second half.