China is a market that many businesses expect to recover sooner than other markets such as the US and EU in the context of seafood processing and exporting enterprises are facing many challenges. However, contrary to these expectations, the export turnover of catfish and shrimp to China in the past 05 months has decreased more sharply than exports to the US and EU.
Seafood exports to China are facing many difficulties.
According to the Ministry of Agriculture and Rural Development (MARD), seafood exports in May 2023 reached 800 million USD, down 24% compared to May 2022. Accumulated in the first 05 months, seafood exports were only 3.47 billion USD, down 25.9% over the same period in 2022.
THE CHINESE MARKET IS NOT AS EXPECTED
A recent seafood industry analysis report of VNDirect Securities Company shows that Vietnam’s seafood exports to the US in the first 04 months of 2023 decreased by 51% compared to the same period last year. The reasons are due to rising inflation and high inventories.
However, the demand for seafood consumption in the market is likely to recover from the second half of 2023 due to reduced inflation and inventory as well as high demand for the end of the year. This will help Vietnam’s seafood exports to the US in the second half of 2023 increase by 40-50% over the same period.
In the context of high inflation, stable demand for catfish is helping Vietnam’s seafood exports keep the market share in the EU. In the first 04 months of 2023, Vietnam’s catfish export turnover to the EU reached 60 million USD, down 8% over the same period in 2022, accounting for 11% of Vietnam’s total catfish export turnover.
“Among key seafood products, shrimp and catfish exports in the first 05 months of 2023 decreased sharply: catfish exports only reached 690 million USD, down 40.7%; shrimp exports reached 1.22 billion USD, down 34.4% over the same period last year.”
According to the MARD
Data from Agromonitor Analysis Company shows that the average export price of catfish in Q1 of 2023 to the EU increased by 9.5% over the same period, while the export price to the US market decreased by 22%.
This demonstrates that the demand for catfish in European countries continues to improve and stabilize in the second half of 2023. Inflation in the EU remains high. While the supply of other white-meat fish such as pollock fish is affected by tensions between Russia and Ukraine, the door for Vietnamese catfish to this market is still widely open.
The door for Vietnamese catfish to tthe EU is still widely open.
China is a market that many businesses expect to recover sooner than other markets such as the US and EU in the context of seafood processing and exporting enterprises are facing many challenges.
However, contrary to these expectations, the recovery of Vietnam’s seafood exports to China is not as expected. The export turnover of Vietnam’s main export products such as catfish and shrimp to China decreased sharply by 68% and 30% respectively in the first 04 months of the year.
This data shows that catfish and shrimp exports to China are declining much more sharply than exports to the EU and the US.
“Strongly adjusted pork prices and an increase in the supply of tilapia fish again have reduced the demand for catfish. Meanwhile, Vietnam’s shrimp exports to China are subject to fierce competition with countries such as India or Ecuador…”, VNDirect said.
Due to the unpredictable macroeconomic background of the Chinese economy and fierce competition from other countries, VNDirect forecasts that Vietnam’s seafood exports to China in the second half of 2023 will not grow strongly compared to the first half of the year.
According to the Vietnam Association of Seafood Exporters and Producers (VASEP), catfish exports to China have not recovered as expected due to the decreased average export price. Contrary to our expectations, the export turnover of Vietnam’s key export products such as catfish and shrimp to China decreased sharply by 68% and 30% respectively in the first 04 months of the year.
Explaining the reason for the deep decline of the Chinese market, VASEP said that: despite the re-opening after the Covid-19 pandemic, the consumption demand of this market recovered more slowly than expected. This economy is still facing constant challenges, making the recovery slow, and shows no signs of being sustainable. Even China’s domestic production is struggling because consumer spending is weaker than expected./.