Orders coming, but Vietnamese don’t have tra fish to sell

VNEconomyNews.com - Foreign importers continuously contact to place orders, but this does not make Vietnamese exporters happy: they do not have tra fish to sell.

Just a couple of weeks ago, farmers cried about the tra fish unsaleability, especially oversize fish. The tra fish prices dropped dramatically, while merchants, who supplied fish to processing workshops, refused to collect fish from farmers

At that time, experts all had the same voice that the tra fish export would face big difficulties in the last months of the year, due to the public debt crisis in Europe and the US, which would force consumers to tighten their belt and lead to the demand decreases.

However, contrary to all predictions, the purchasing power decreases did not occur. The demand from the market has increased again since late August, when the seafood consumption season in the two biggest markets of the EU and US has resumed after the summer holiday.

A lot of foreign importers are seeking to purchase tra fish in big quantities, offering attractive prices. However, many Vietnamese exporters now have to refuse to fulfill the orders because of the lack of materials.

Duong Ngoc Minh, General Director of the Hung Vuong Seafood Company, said that a lot of European and US importers have come over the last week to order big volumes of filet tra fish products.

“They asked to sign the contracts on exporting tra fish with the deliveries from September until the end of the first quarter of 2012. The average export price is 20 percent higher than that in July,” Minh said.

According to Truong Dinh Hoe, Secretary General of the Vietnam Association of Seafood Exporters and Producers VASEP, the financial difficulties in the US and Europe have only led to the changes in the way of doing business.

In the past, when it was easy to access low-cost bank loans, importers always tried to store goods when the prices were low. Nowadays, as the credit has been tightened, they have to change the way of trading: they need to import goods and then sell the imports immediately.

In fact, tra fish products have become more favorable these days, because tra fish is still cheaper than other kinds of seafood, which fits the pockets of consumers. Therefore, tra fish remains on the top priority in the list of import items.

The prosperous export market has immediately caused a stiff competition among seafood processors to scramble for materials.

On August 30, the first class tra fish (600-700 gram per fish) was traded at 24,500 dong per kilo on the domestic market. Meanwhile, oversize fish was sold at 22,000 dong, an increase of 1500 dong per kilo in comparison with the price seen in mid August.

However, even when accepting high prices, seafood processors still find it difficult to collect materials. As a result, they have to refuse many orders.

The factories that make feed for aquaculture have reported that the sales of feed have been decreasing dramatically month after month, by 20-30 percent, and sometimes 50 percent. The problem is that a lot of farmers now do not intend to breed fish any more, after they incurred big losses due to the tra fish price decreases some months ago.

The tra fish price has dropped from 28,000-29,000 dong per kilo to 20,000-21,000 dong over the last three years. Meanwhile, the credit tightening policy, which has pushed the lending interest rates up, has prompted farmers to leave fish ponds idle.

Therefore, VASEP has warned that tra fish materials would be seriously lacking in September and the high peak consumption season in the last months.

Vietnam exported nearly 400,000 tons of tra fish in the first eight months of the year, earning 1.1 billion dollars in export turnover, which represent the increase of four percent in quantity, and 25 percent in export turnover over the same period of the last year. VASEP believes that the export turnover would reach 1.5 billion dollars by the end of the year.

September 3, 2011

Source: vneconomynews.com