Vietnamese Shrimp Exports Continued Climbing in May on Strong Chinese Demand

According to data from the Vietnam Association of Seafood Exporters (VASEP), Vietnamese shrimp exports reached a value of $457 million in May. For the first five months of the year, export value now sums $1.9 billion. Exports to China experienced a sharp increase of 126% YoY to reach $88 million in May. In Jan-May 2022, China imported a value of $275 million, which represents an annual increase of 101%.

It's worth noting that China has been increasing its share of total Vietnamese shrimp exports in recent months. Its import share almost doubled from 9% in February to 17% in March. It then went up to 19% in May. For the total value accumulated in the first five months of the year, China held a 14.5% share. This YTD share has also been consistently increasing since February of this year.

According to the same association, Chinese demand for Vietnamese shrimp has crept up as Covid control measures have eased. Favorable consumer spending policies in China are expected to keep the imports of Vietnamese shrimp elevated.

Nonetheless, the largest market for Vietnamese shrimp is still the US. This May, however, export growth decelerated sharply, registering a 3% YoY pace, down from a previous 52% pace in April. In May, exports to the US were valued at $99 million. In the first five months of the year, export value sums $390 million. The share of the US in Vietnamese shrimp exports for Jan-May 2022 was 20.5%, slightly decreasing compared to the share held in Jan-Feb, which was 21.1%.

The US has reduced the growth pace of its imports of Vietnamese shrimp as the country reportedly has already a high inventory of this commodity. According to VASEP, Vietnamese shrimp exports to the USA are expected to continue growing but at a slower pace.

In fact, there’s evidence of this deceleration in US import prices. According to USDA data, US import prices for Vietnamese frozen shrimp peaked in January at $13.19/kg, representing a YoY increase of 36%, but then declined to $12.32/kg in February (+22% YoY) and stood at $12.60/kg in April (+9%YoY).

Meanwhile, live, fresh shrimp wholesale prices in Vietnam climbed in early June to $8.20/kg after hovering around $7.85/kg from March through May. Prices had previously peaked in mid-February. However, prices are still trading considerably above 2021 levels.

Source: Tridge

Prices are expected to remain supported by strong Chinese demand and some supply tightening expected for the upcoming months due to unfavorable weather.