Vietnamese shrimp exports are projected to reach approximately $3 billion, as the first five months of this year witnessed exports amounting to $1.2 billion, marking a 34% drop compared to the same period in 2022.
The decline in exports to the United States is attributed to the higher price of raw shrimp from Vietnam compared to rival suppliers such as Ecuador, India, and Indonesia. Additionally, high inflation and consumer preference for cheaper food, coupled with inventory challenges, falling product quality, and high storage costs, contributed to the decrease.
The increase in interest rates in the US, surpassing those in Vietnam, negatively affected the demand for shrimp imports in the US market. However, there is a slight expectation of increased shrimp import demand from August onwards to meet the demands of the year-end festival.
In the European Union market, consumption demand slowed during the initial months of the year, resulting in a 49% decline in shrimp exports to the EU compared to the same period last year. Factors contributing to this decline include the Russia-Ukraine war, thrifty consumer spending habits, price increases in goods and gasoline, and the depreciation of the EUR. Vietnamese shrimp faced competition from Ecuadorian and Indian suppliers, although they could not fully meet the requirements of the discerning EU market. Consequently, there is still room for Vietnamese processed shrimp in the EU market.
Vietnamese shrimp exports to markets such as Japan, China, Hong Kong, and South Korea also experienced respective declines of 27%, 22%, and 29%. These declines were influenced by factors such as high inflation, currency depreciation, cautious consumer spending, and high inventory levels.
Shrimp is a vital product, accounting for 40% to 45% of the total export value of Vietnam’s seafood industry. Although Vietnamese shrimp exports are showing signs of improvement, the recovery is occurring later than initially anticipated. Truong Dinh Hoe, the general secretary of the Vietnam Association of Seafood Exporters and Producers, indicated that the improvement is based on export data from March, April, and May, which indicated increased shrimp imports from Vietnam and other countries and progress in resolving inventory issues. If the market recovers from July, there should be an adequate supply of raw shrimp in the coming period.
However, Hoe predicts that shrimp exports will only reach $3 billion by the end of the year, which, although considered a success, falls short of the industry’s target of over $4.3 billion for this year.
