Solid Growth in 2021 for Vietnam's Seafood Exports Despite Logistics Challenges

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Published Dec 28, 2021

In the first eleven months of 2021, Vietnam’s seafood export value increased by 4% over the same period last year, reaching nearly USD 8B. Despite several logistics constraints resulting from the COVID-19 pandemic, overall Vietnamese seafood exports to most markets increased in value compared to 2020. According to the General Department of Customs, by November, Vietnam's seafood exports of all kinds continued to increase for the third consecutive month by 2.5% and by 23% over the same month last year. The US has the most significant growth from all of the markets, followed by the Japanese market and then the EU market. However, at the same time, exports to Europe and America are struggling the most because of the sudden increase in logistics fees.

The General Department of Customs in Vietnam has released some preliminary statistics about the country’s turnover of all general seafood exports. Despite much impact from the pandemic, seafood exports of all kinds have continued to increase for the third consecutive month in November by 2.5% monthly. As a result, the export value has increased by 4% in the first eleven months and is expected to pass the USD 8B mark.

Substantial Increases in Specific Key Markets Drive the Growth

According to preliminary data, in November, Vietnam’s seafood exports reached USD 911K, a 23% increase over the same month of 2020. This data shows a gradual but strong recovery of Vietnam’s seafood industry after 2020 when the demand from its main markets has increased, and import prices have also tended to increase. The US was Vietnam's leading destination for seafood exports, accounting for 23.4% of the country's total seafood export value, reaching over USD 1.87B in the first eleven months and representing an increase of 25.4% over the same period of 2020.

Following the US, seafood exports to Japan accounted for 15.2% of the total exports and were ranked as the second-largest market in value. In November 2021 alone, the export value increased by 13.8% compared to October 2021 and increased by 1.8% compared to November 2020, reaching USD 136.4M. For the first eleven months of the year, exports to Japan reached USD 1.21B, an increase of 7% over the same period last year.

Source: ITC Trade Map, Tridge

The EU market ranked third with USD 914.12M, accounting for 11.4% of the total exports and having an increase of 9.9% over the same period last year. The fourth-largest market was China, which accounted for 10.8% of the total and reached a value of USD 862.79M. However, this export data to China showed a 21.7% decrease compared to the same period last year.

Exports to Europe and America Riddled with Major Logistic Challenges

Exports to Europe and America are challenging due to the sudden increases in logistics fees. In addition, congestion at seaports has caused Vietnamese enterprises exporting to Europe and America to suffer high transport costs, orders have been delayed by 2 to 3 months, and delays in import countries have also added to the constraints. However, these logistic obstacles have been presented to all major seafood suppliers, such as for Latin American suppliers and other Asian producing seafood countries. In the case of Vietnam, it seems that the seafood industry has adapted well to the post-pandemic situation and has taken advantage of the increased global demand for seafood over the last months of the year.

It has been reported by the Ministry of Industry and Trade that the Vietnamese major seafood-producing regions, such as the Soc Trang province, have gradually recovered their aquaculture production from the epidemic controls. Although the COVID-19 pandemic is still affecting production capacity and efficiency, businesses are making efforts to fight the epidemic while boosting production to take advantage of the increasing global demand. Thus, seafood exports in the last months of the year are expected to continue recovering.

European and US Markets to be the Main Focus

Data from the Vietnamese Ministry of Industry and Trade show that in 2021, despite the impact of the pandemic, seafood trade between Europe and the Americas in the first ten months of the year had an impressive growth rate of 18.8%, reaching USD 2.8B. However, with higher logistics costs that have increased the import value in all of the imported markets, the priority for Vietnamese seafood exports is to increase its market share in higher-value markets such as the US and Europe.

It was recently reported by Catie Bui, Tridge’s Engagement Manager in Vietnam, that seafood exporters are looking into reducing taxes when entering the EU market. “With the EU's commitment to reduce the tax to 0% for seafood products (including shrimp) for Vietnam in the EVFTA Agreement, Vietnam's seafood exports in general and shrimp exports, in particular, will have an advantage over other seafood suppliers,” she mentioned. Furthermore, as per the tariffs, she mentioned that it is possible to adjust the prices to be more competitive in the future.

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