Vietnam: A turbulent Pangasius year is near the end
By Herby Neubacher, Seafood Consultant, Nha Trang City, Vietnam
Lack of farming output caused some trouble in the industry but in the end the Pangasius processors in Vietnam have been “saved by the bell” – the value of exports reached nearly the 2008 level and ended at 1.3 billion US Dollars.
The bell that saved the Vietnamese Pangasius industry rang in the United States. The US market came back strong for the Pangasius processors; some of them even dedicate over 50% of their 2009 production to this market (i.e. market leader Vinh Hoan and QVD).
The US market will be the big question for the year coming up as the US farm bill that could wipe the Pangasius off the US landscape has still not been put in action but could change the situation dramatically when released.
The Russian market is the second joker in the game – sometimes there, sometimes not, now you see him now you don’t. Some companies that depend heavily on Russians orders (such as Nam Viet or Hung Vuong) can upset the European price structure when they are cut out in Russia and must find buyers in Europe to take their stock.
The Vietnam Government recently announced plans to invest heavily in farming. When this comes to pass the second half of the year 2010 might look quite different. 1.6 million tonnes could be reached then and 600,000 tonnes of product could swamp the market and weaken the currently very strong price situation for the sellers.
In any case it would be good if there would be a bottom line price level enforced in Vietnam. The waves of supply and demand take more farmer-lives by the year and it can be in nobody's interest to let the farmers in Vietnam go bankrupt regularly on the demand-supply situation.
Another joker in the game is the growing interest in Pangasius by other fish-producing markets like India, Malaysia, possibly Thailand and even Africa, who see the success of Pangasius and want their share. It will be important for Vietnam to emphasize its unique situation in farming and its processing experience to keep their customers in 150 markets at their side.
In this respect the quality question becomes crucial for Pangasius from Vietnam. The Management of this quality must start at the bottom, to silence the voices from the European fishing community that lobby strongly against Pangasius which it sees as the White Fish competition for their catches.
There will be Global GAP next year Vietnam – this is beyond doubt. The market demands it – the Vietnamese farmers are preparing. Whether there will be another standard put on top by the WWF (Aquaculture Stewardship Council (ASC)) is yet to be seen but it seems likely that this will be the next step.
The Farming operations of Vietnam must gear up to match the demands of the more critical and demanding markets like Europe.
I wish us all a good next Pangasius year coming up. Pangasius is here to stay, this is out of question, it will be Pangasius from Vietnam if it is of good quality…
So lets all work on that.