VASEP wants greater imports of raw seafood materials

Việt Nam's seafood export value is expected to reach US$9 billion this year. Photo vnbusiness.vn

The State should have policies to encourage the import of seafood materials for export processing because processing factories lack raw materials, according to the Việt Nam Association of Seafood Exporters and Producers (VASEP).

In an official dispatch sent to the Ministry of Planning and Investment, VASEP said that after 12 fuel price increases since the beginning of the year, 40-50 per cent of fishing vessels have now stopped operation.

Meanwhile, businesses all have the need to expand aquaculture regions, which provide 70 per cent of raw materials for export processing, to increase the supply of the material.

However, at present, localities are urbanising, so change in land planning for production is a challenge for seafood enterprises and farmers.

These cause the input materials for processing plants to decrease by 70-80 per cent compared to before.

Therefore, based on the Fisheries Development Strategy to 2030 approved by the Prime Minister in 2021, VASEP has proposed the Government to issue regulations and policies to encourage the import of aquatic materials for processing export products.

This will help Việt Nam achieve the goal of becoming one of the largest seafood processors in the world.

In the past 10 years, the import of clean and legal raw materials to Việt Nam surged to meet increasing demand on seafood from the global market, according to VASEP.

VASEP said that the policies on encouraging the import of aquatic materials for processing export products are still lacking, and the procedures for the import still have many obstacles.

In addition, VASEP believes that it is necessary to speed up the amendment of the Land Law. Of which, the amendment should focus on the issues of land accumulation, land use regulations, and land planning. Those would help the fisheries sector develop suitable concentrated farming regions.

Meanwhile, Governments and localities also need policies to develop and expand the aquaculture regions.

VASEP also said that another challenge was obstacles in procedures of certifying the origin of caught fish.

According to VASEP, the COVID-19 pandemic has gradually stabilised, so the world's shrimp import demand has increased again.

Việt Nam's shrimp exports in 2022 are expected to grow well due to the advantages of free trade agreements (FTAs), ensuring stability in commercial shrimp farming and processing.

Meanwhile, food prices in the EU are forecasted to increase by the end of 2022. This will be a good opportunity for Việt Nam's pangasius businesses to return to the market after many years of Việt Nam's pangasius exports affected by the pandemic.

Việt Nam's pangasius exports to major markets at present have growth potential. Increasing and stable consumption demand can help maintain the volume of purchased fish material at the current level.

According to Nguyễn Hoài Nam, VASEP deputy general secretary, the seafood exports in the first six months of the year gained growth, but there are still many unexpected factors threatening the seafood industry in the second half of the year.

Besides the problem of freight and supply chain disruption due to the Russia-Ukraine conflict, one of the biggest difficulties for the local seafood enterprises is to ensure enough processing materials for year-end orders, Nam said.

Hồ Quốc Lực, chairman of the Sao Ta Food Joint Stock Company, said that many shrimp farms in Sóc Trăng Province were facing difficulties because of the COVID-19 pandemic, and some had closed.

The supply of raw shrimp will decrease sharply because farmers do not dare to develop shrimp farming due to the potential of a pandemic breakout.

Sao Ta is still dependent on external raw material supply because the company's farming region only meets 20-30 per cent of its processing demand. Full autonomy of all shrimp materials is not possible because the shrimp farming industry is still developing spontaneously.

Forecasting pangasius exports in 2022, Võ Hùng Dũng, former director of VCCI's branch in Cần Thơ, said there are two scenarios of surpassing the turnover milestone achieved in 2018 at over $2.2 billion, or only reaching $2 billion.

The export turnover depends on output and expansion of farming region, not market demand.

Dũng said pangasius exports increased sharply in the first six months mainly due to large inventories from the previous year, not an increase in farming output.

At present, the world demand increases sharply while the domestic seafood industry is facing the biggest difficulty of lacking raw materials.

However, Dũng said a shortage of raw material supply may be better than an excess. This shortage may be a short-term difficulty for businesses, but it is also a reason for them to make more effort in having sustainable development of their value chains.

"It doesn't matter if the fish industry lacks input, the businesses can increase imports for processing. The processors' increase in raw material imports is also a way for them to penetrate deeper into the global supply chain, making the businesses develop further," Dũng said.

The Directorate of Fisheries forecasts the total seafood output in 2022 to reach 8.73 million tonnes and the total seafood export value to be $9 billion.