Warning of raw materials shortage for seafood factories
MEKSEA.COM – The complicated and prolonged situation of covid-19 in the southern provinces and the Mekong Delta has seriously affected shrimp farming activities in the localities. It is forecasted that in the fourth quarter of this year, there will be a serious shortage of shrimp materials, leading to a sharp increase in product prices, especially bigger-sized shrimp.
According to the Association of Seafood Exporters and Producers (VASEP), in the first half of 2021, Vietnam’s shrimp exports reached 1.7 billion USD, up 13.7% over the same period last year. Exports to main markets, excluding China, grew well. In which, Vietnam’s shrimp exports to major markets and blocks such as CPTPP, US, and EU all increased by double digits from 14% to 36%. In terms of export products, Vietnam’s vannamei export value grew by 24%, while the export value of black tiger shrimp and marine shrimp decreased by 4% and 22%, respectively, over the same period last year.
Currently, Vietnam’s shrimp farming and processing industry for export is concentrated mainly in the Mekong Delta provinces, with the focus being the three provinces of Ca Mau, Soc Trang and Bac Lieu, accounting for 61% of the country’s shrimp exports.
Mekong Delta provinces accounting for 61% of the country’s shrimp exports. (photo: Internet)
However, businesses are facing many difficulties right from the production of raw materials. The fourth wave of epidemics broke out and continuously had complicated developments, prolonged social distancing led to supply disruptions, and traffic between provinces faced many difficulties. As reflected by some other shrimp processing enterprises, a number of shrimp farming supplies, including shrimp seed and aqua feed, encountered many difficulties and disrupted the stocking schedule.
Moreover, the implementation of “3 things at the factory” to meet epidemic prevention requirements forced businesses to reduce production capacity to about 30%-50%, the demand for raw materials also decreased significantly. Therefore, the stocking activities of the two-year crop tend to be quiet. It is forecasted that in the fourth quarter of this year, there will be a serious shortage of shrimp materials and the consumption price will increase strongly.
In addition, capacity on international routes is seriously short of peak season demand, transportation costs are at a record high and it is forecasted to increase further. The situation is made more difficult by canceled trains, extremely scarce seats, and shortages of container equipment.
Covid-19 put pressure on shrimp prices in the market as enters the year-end period. (photo: Internet)
Not only in Vietnam, but other countries that provide good shrimp processing also fall into difficult situations due to the disease (such as Thailand, Indonesia). Workforce stresses, traffic congestion and disruptions related to the Covid-19 epidemic are expected to put additional pressure on shrimp prices in the market as enters the year-end period.
To ensure the growth of shrimp exports in the following months, it is very necessary to ensure stable shrimp farming activities. Currently, in addition to solutions to expand safe “green areas” to increase shrimp farming areas in the Mekong Delta provinces, VASEP has also made proposals to State agencies to implement safety for workers in order to bring Production activities will soon return to normal. Speed up vaccination for workers at factories, support low-income workers. At the same time, offer policies to support businesses in insurance, unions, bank interest rates, and other costs so that businesses can feel secure in production.
Moreover, there should be a synchronous coordination mechanism among localities in disease prevention and control, removing difficulties for businesses, ensuring smooth transportation to maintain production and export, etc. creating favorable conditions in harvesting, trading and transporting shrimp from ponds to factories faster, while still ensuring regulations on disease prevention.
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By Tuyen Ho (Meksea Team)
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