Vietnam: Warning of raw materials shortage for seafood factories

Bởi Meksea Team - August 27, 2021

MEKSEA.COM – According to enterprises, materials for export processing only reach about 40-50% due to social distancing. It is estimated that the source of materials for seafood export in the last months of the year will lack 20-30%.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), the export market has succeeded but the complicated epidemic situation, particularly many provinces in the South of Vietnam is implementing social distancing measures under the Prime Minister’s directive 16 making trouble in seafood production. Enterprises are only allowed to maintain operations if they fulfill “3 things at the factory” (produce, eat, rest) to prevent the spread of the disease into factories and industrial zones. There are 30% of seafood enterprises in provinces in the South of Vietnam, including Ba Ria – Vung Tau meets “3 things at the factory”. However, only about 30% of the workforce is used, the others have to quit or take unpaid leave.

cong nhan thuc hien 3 tai choEmployees are having lunch at the factory during the covid pandemic (photo: Internet)


There will be lack of raw materials for production and export

The seafood enterprises in Ba Ria – Vung Tau explain that it is difficult to all workers to meet “3 things at the factory” because 70% of them are local people. Thus, production capacity can only maintain about 30% compared to before. Meanwhile, raw materials mobilized for processing and export only reach about 40-50% because domestic and imported materials are limited during social distancing. Therefore, it is predicted that the source of raw materials for export production in the last months of the year will be 20-30% short. In fact, in coastal provinces such as Binh Dinh, Kien Giang, Ba Ria- Vung Tau, etc and some enterprises have reduced their capacity by 20-70% due to lack of raw materials.

cong nhan thuy san

The source of the materials for production and export will be lack if the covid-19 pandemic is more and more complicated (photo: Internet)

According to Dong Thi Hue, director of Thuan Hue Trading and Service Production Joint Stock Company, her business has been proactive in production material for 3-4 months. However, the company has been in trouble with their main production material collected domestically because people cannot fish during the covid epidemic. Therefore, the source of materials will be short of 20-30% by the end of the year if the epidemic situation is still complicated.

At Baseafood Seafood Import-Export Processing Joint Stock Company, production material imported domestically and abroad is only enough to produce for 1 month. According to Tran Van Dung, Chairman of the Board of Directors of the Company Baseafood, although the company has actively contacted partners to purchase raw materials, the lack of raw materials for production at the end of this year is inevitable.


Seafood factories are under pressure from costs arising

Not only shortage of production raw materials but also many seafood enterprises under the burden of costs due to covid-19 such as personal protective equipment for workers to work “3 on-site”, paying extra wages, taking periodic tests, and costs spent on logistics increasing. According to Truong Dinh Hoe, General Secretary of VASEP, since the COVID-19 epidemic occurred, production costs increased by 1.5-2 times compared to before. In the current difficult situation, the production of seafood exports in the second half of the year will be reduced certainly, if the Government does not have solutions. Especially, this is necessary to priority to vaccines for workers in seafood processing factories, ensuring safety criteria, then support for enterprises and workers affected by covid 19.

Before the problems of the seafood industry, Deputy Minister of Agriculture and Rural Development Tran Thanh Nam said that Ministry suggested localities to have solutions to support enterprise, avoid lacking labor in factories persist, support traders and seafood collecting enterprises operate. At the same time, the Government has directed Government Bank to have policies on capital (debt relaxation, interest rate reduction and preferential loans, etc) for aquaculture households, especially brackish water shrimp farming to accelerate production progress this year.


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