Shrimp prices increase, troubling exports

Sharp increase in shrimp prices added to the higher costs of losgistic are making trouble to Vietnamese shrimp exporters

Since early 2021, especially after the Tet holiday, prices for black tiger shrimp and white leg shrimp increased sharply in the Mekong Delta, making many in Ca Mau peninsula provinces in lack of raw materials.

Currently white leg shrimp size 20 pieces each kg are at VND 215,000 per kg. Shrimp size 100 pieces each kg are VND 104,000 per kg, compared to the last year, this size shrimp price was less than VND 85,000 per kg. Prices for shrimp size 80 pieces per were of VND 108,000 per. They were VND 90,000 per kg last year. The most popular shrimp for export with the size of 40 pieces per kg was sold at VND 150,000 per kg, much higher than prices of this type in some recent years.

According to traders of raw shrimp, most of the shrimp farms are preparing for the new shrimp crop while shrimp farmers have sold out of their products.

Enterprises purchasing and processing shrimp for export consider such an increase at the beginning of the crop is normal according to the law of supply and demand not because of changes in world supply.

They say: “Shrimp import markets of China and EU countries or domestic consumption decreased before Tet.” They added: “Currently, it is not the time of great fluctuations in supply and demand, even the world shrimp supply-demand balance is in quiet.”

Some businesses and home owners in hi-tech shrimp farming in Soc Trang, Bac Lieu Provinces said that despite the advantage of shrimp farming, new technologies to control the environment that helped reduce disease and increase yield, the shrimp output in this time was low.

Representative of an export enterprise said: “Many shrimp exporters push their activities in the last months of the year, so in some first months of the next year, shrimp stocks decreased sharply. While there is also a temporary shortage of raw shrimp at this time, it makes them difficult to have shrimp to process for supply the export contracts.”

At the same time, seafood processing enterprises, especially shrimp exports to EU markets, faced with other difficulties.

Container freight rates, especially those for ships to the EU, are abnormally high at three and four times higher. The normal level of US$ 1800 each container was increased to $ 7,800. There are some shipping lines announced to reduce costs but they lacked empty containers. Vo Van Phuc, General Director of Vietnam Clean Seafood Joint Stock Company (Vinacleanfood), said: “From the end of November 2020, production costs such as packaging and materials for processing increased by 10-15 per cent and another 10 per cent at the beginning of March.”

Phuc said suppliers of those products increase the prices due to the impact of the COVID-19 which created a broken supply chain, and an increase in transportation costs.

Despite mentioned difficulties, according to the annual forecast, the world shrimp demand in 2021 will still have a growth rate of about 5 per cent per year.

The world market shrimp prices will remain high, especially for the countries with vaccines against COVID-19, said the experts adding the advantages of free trade agreements (FTAs), which are being well utilised by businesses, would create motivation for shrimp exports in 2021.

The Vietnam Association of Seafood Exporters and Producers (VASEP) estimated shrimp exports would have the strongest growth rate of 15 per cent, reaching $ 4.4 billion.