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Pangasius exports: The sharp increase in price is not yet stable

The pangasius industry sets an export target of over US$1.6 billion in 2022. Photo: N.Thanh

The market is getting better

Information from the Vietnam Association of Seafood Exporters and Producers (VASEP) as well as many pangasius processing and exporting enterprises shows that currently, all pangasius export markets are getting better; thereby pulling the price of commercial pangasius to VND29,500-30,000/kg, an increase of VND4,000-5,000/kg compared to the last months of 2021.

A representative of the Department of Agriculture and Rural Development of Can Tho province said in Can Tho, due to the prolonged impact of the Covid-19 pandemic, many establishments have paused, while the rest raised fish in moderation, so the amount of fish was limited.

Raw materials (size 0.8-1kg/head) supplied to the export market are not much.

Resources are scarce, most fish are 0.5-0.7kg/fish. In Thot Not and Vinh Thanh districts, some farmers have fish that have reached harvest size but have not yet been sold when prices are rising sharply. In O Mon district, a few households are selling.

“From the beginning of the year until now, the price of pangasius has increased very sharply. This is an opportunity for people and businesses to continue to invest and develop production," said Nhu Van Can, Director of Aquaculture (General Department of Fisheries, Ministry of Agriculture and Rural Development).

Looking at pangasius export opportunities in the whole of 2022, To Tuong Lan, Deputy General Secretary of VASEP, said: “The import market has recovered and grown well. There are four main markets including China (31%), the US (23%), members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (13%) and the EU (6.6%). It is forecast that pangasius exports in 2022 will increase by 20-25% compared to 2021. The Pangasius export price will increase by about 5%.”

Similarly, a representative of the Vietnam Pangasius Association said 2022-2023 will have many advantages in terms of raw material prices and pangasius export prices.

Pangasius production will increase sharply from the end of 2022-2023. Gasoline prices have increased, world sea fish prices have increased, and sea fishing has been and will continue to be limited, so Vietnam's freshwater farmed fish (pangasius) will have a better place in the world market.

Note the balance of supply and demand

Besides favorable factors for the development of the pangasius industry this year, Nhu Van Can also pointed out some difficulties and challenges. In terms of weather and climate, in the dry months of 2022, the total flow from the upper Mekong River to the Mekong Delta is likely to be 10-15% short of the average of many years. Saltwater intrusion in the Mekong Delta is higher than the average level for many years, likely to be concentrated between February and April. There is reduced water availability and potential disease risk.

From a market perspective, the new-generation free trade agreements that Vietnam joins are both a challenge and an opportunity for Vietnamese pangasius products to continue to be exported to the EU and US markets. However, the increasingly strict requirements from the import market require the pangasius industry in our country to make efforts. "After the Covid-19 pandemic is under control, it is also necessary to resume direct inspection by the Food Safety Inspection Service (FSIS) of the US Department of Agriculture for the entire pangasius chain," said Nhu Van Can.

Along with opportunities, there are still challenges posed to the pangasius industry, To Tuong Lan emphasized that relevant agencies in the fisheries sector and partners involved in the production chain need to assess and orient farmers. That is to balance supply and demand to increase profits and value for the pangasius industry.

“After the Covid-19 pandemic, although production activities have recovered, the pandemic has not ended, which is still a challenge for the supply chain. Production and transportation costs have escalated, and the situation of sea transportation still needs a positive solution,” said Lan.

Tran Van Hung, General Director of Hung Ca Co., Ltd., warned that there may be a phenomenon that some businesses see a shortage of pangasius, so they have raised the purchase price to stimulate farmers to promote farming. When farmers raise a lot, leading to oversupply, causing prices to drop, businesses will benefit because they can buy late at low prices.

Similarly, Nhu Van Can also said that, with the current situation of Pangasius prices increasing, local authorities need to strictly control supply and demand, meaning that the output of raw pangasius does not exceed market demand.

"It is not advisable to massively raise pangasius and control the quality of pangasius fingerlings in the Mekong Delta in the near future," Can said.

Pham Truong Yen, Deputy Director of Can Tho Department of Agriculture and Rural Development suggested that it is necessary to continue to implement the issuance of pond codes to ensure production according to planning and quickly adapt to the market mechanisms, contributing to production stabilization through supply-demand balance; improve traceability from fingerlings and inputs to raw pangasius.

Deputy Minister of Agriculture and Rural Development Phung Duc Tien noted that seafood processing enterprises are interested in building closely linked farming areas; associated with farming establishments through product off-take contracts with investment and financial support, jointly responsible for supervising and monitoring the production process; closely monitor market developments to respond quickly, meet the requirements of importing countries, and be ready to export as soon as the opportunity arises.