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Market environment » Farming and Fishing and Forestry and Wildlife Contracting Services » Vietnamese Pangasius Market


Vietnamese Pangasius Market


There are 3260 km of sea coastline, 112 river outlets and 4000 average islands in Vietnam. The country is situated along South-Chinese Sea, and fishing has become one of the main fields of activity. Recently, fishing is developing along with sea and river fish breeding.

The most widespread kinds of fish are tra and basa. Vietnam exports these kinds of fish under a name Pangasius. Pangasius is bred on specialized farms in the delta of the Mekong River in the South of Vietnam, where there are favorable conditions for it. There are too many Pangasius’ farms of various volumes of output in the delta of the Mekong.

In the course of 1997-2006, areas under tra and basa breeding grew from 1300 to 5200 ga in Vietnam; volumes of output increased by 1 mln t a year. As for 2007, Vietnam farmed 90% of Pangasius from the world’s total number. Over 200 enterprises export pangasius.

The year 2008 is going to be very successful for Pangasius producers. A share of biggest producers of pangasius is considerably up in 2008, which has to have a favorable impact on quality and easiness of a control.

Export

Export of aquaproducts plays a key role in the economy of Vietnam. In 2007 these products were exported to the amount of US$3,75 bn, up US$400 mln from 2006. An average increase of export totals 17%. The EU takes first place by fish and other seafood import from Vietnam – 24.4%, the USA – 18.3%, Japan – 17%, S. Korea – 7.4%, Russia – 5.2%, China – 5.1%. In 2006 occurred a sharp sudden change of export into Russia (nearly four times).

According to the official data, currently Vietnamese pangasius is exported to 60 countries of the world. In 2006 in rivers and pond of the Mekong delta were farmed 600 thou t of pangasius. As to 2007, the harvest amounted to 1 mln t. In the 1 half 2007 was exported 25% pangasius up on the same period of 2006. These days there are some concerns that the delta of the Mekong, as an ecosystem, won’t manage with an exerted pressure on its extensively developing aquaculture.

Over the last decades, the aquaculture Pangasius has been very rapidly developing in Vietnam. In the last two years were recorded maximal rates of growth. Thousand hectares of rice fields were reequipped into ponds for pangasius in 2007, when prices for pangasius went up. As to 2007, processing capacities also develop ultra speedily. So, in 2006 about 50 conversion subsystems were engaged in processing of fish raw products; now they are nearly 70.

There are 132 operators-exporters of pangasius in Vietnam. Most of them are equipped with modern equipment, or are in the process of reequipping. Agifish has already launched three new factories this year. Bianfishco invested US$30 in processing and farm capacities. The market leaders also possess big factories on pangasius processing. Nam Viet (Navico) will soon add the big factory Indian Ocean (which is to be launched in October 2007) to its large (the largest in the world) factory on processing and filleting of white fish (Atlantic Fish Factory). The number of Navico workers will reach 300 thou people.

Largest exporters

NAVICO

The leader among exporters. Turnover - US$81,5 mln/year (for compariosn – the whole pangasius turnover of Vietnam US$110 mln/year). The aim for 2007 is to reach a US$200 mln turnover by pangasius export. At the present, NAVICO export pangasius to 52 countries and it’s planned to increase the number of targeted countries by 60. 

HUNG VUONG Co

The company is the second after NAVICO by volume of pangasius market. Export for the first 5 months of 2007 amounted to $22 mln (compared to the whole period of 2006 - $48 mln). Hung Vuong – is the only processing factory in Vietnam, which has 5 various Euro codes catered for 5 different kinds of products.

AGIFISH

The company moved down in 2007 (in 2006 it took the second place). For the first 4 months 2007, 1299 t of pangasius was exported to the amount of US$3,9 mln.

VINH HOAN Co

Then follows the largest company by volumes to the amount of export US$4,5 mln. It the only Vietnamese company which have preferences on pangasius import to the USA. Thus, the USA is a targeted market for pangasius’ deliveries.

VAN DUC Co

This company takes the 5th place in the list of the largest exporters of pangasius  (US$2 mln for the first 5 months of 2007).


BINH AN SEAFOOD Co is to be taken into account, that’s left behind the list, and which is characterized by the professional investment, social product inspection, active self-promotion via partake in international exhibitions and an arrangement of foreign experts and guests’ visits to their factories.

In this way, there are quite enough modern production capacities for processing of pangasius. It should be observed, that despite processing capacities of Vietnam companies that take the lead over a European level, the farms themselves drop behind Europe by a level of development of fish breeding (the level of the Middle Ages). Farms are not acquainted with a system FCR (Food Conversion Rate), therefore fish overfeeding is an everyday occurrence. The monitoring of water quality and other modern technologies of aquaculture are rarely used on the pangasius ponds.

Largest importers

By export of pangasius, Vietnam deals with 80 countries in world market. The EU is a market of primary importance for Vietnamese export of pangasius, as for 2006-2007. This market shows a stable growth (up 46.6% in monetary terms and 38.6% increase in volume terms), compared to the same preceding period. For the first 4 months 2007 Vietnam exported 14740 t of pangasius to the EU countries to the sum of US$142 mln. Nearly 48.5% of the total number of pangasius falls on the EU (46.6% - on 2006, 42% - 2005).
Spain, Poland, Germany, the Netherlands, and Italy are the important EU states-importers of pangasius from Vietnam. Taken together, these countries import 84.4% of the total number of Vietnamese pangasius into the EU. These markets indicate the most swiftest growth (Fig.1).

Fig.1. Volume of pangasius import for January-April 2007, mln USD



Volume of import to Spain in January-April 2007 makes up US$31.3. Pangasius is called there “panga”, taking a solid place on fish counters of supermarkets and fresh fish markets.

By consumer features, Poland is similar to Western Europe. The county is a transit market for a pangasius reexporter into the rest countries of Eastern Europe. Over the first four months of 2007, Poland imported 12.8 thou t of pangasius to the sum of US$30,5 mln. For the same period Germany imported 8.4 thou t to the sum of US$24,6 mln. The Netherlands imported 2,72 thou t to the amount of US$24,2 mln (+64.7% up on the same level of the previous year). This country is also a transit market for the reexporter of pangasius into the other EU-countries.

Italy, as a pangasius consumer market, keeps on preserving high the rates of growth – 49.2%, compared to the same period of 2006, having imported Vietnamese pangasius to the amount of US$9,3 mln.

Russia is the second important market after the EU, though the rates of growth a bit slowed down in 2007. As for April 2007, there were imported 20 915 t of pangasius into Russia to the sum of US$41,7 mln. Thus, the growth rates of the market amounted to 34.4% by volume and 28.8% by costs, compared to the same period of 2006.

A new market for Vietnamese pangasius has become Ukraine. The Ukraine market of pangasius is the 8th one by import of this product in the world in monetary terms (follows after the USA).  In volume terms pangasius import to Ukraine exceeds pangasius import into the USA over 4680 t. For the first four months 2007, the grand total of imported pangasius into Ukraine reached US$14,1mln as against US$2,4 mln for the same period of 2006. However, volumes of import increased practically in seven times from 1135 t to 7362 t.

Latin America has also joined the regions importing Vietnamese pangasius. Mexico has become a new profitable market in this ground. Following a farm channel’s sheatfish from the USA, pangasius is successfully exported from Vietnam.

Instability of market prices

At the beginning of 2008, producers’ prices for pangasius grow up US$1.0-1.2/kg. In may prices decreased. As for June 2008, prices for pangasius amounted to US$0.84/kg due to various reasons. Thus, lots of farms at the delta of the Mekong are shut down. Fish factories on pangasius fillet processing operate at reduced powers. Farmers piled up huge reserves of fish.

Prices for pangasius feeding are in the range from US$0.52 to US$0.59 per kg, and are able to double in the near future. In such a way the sector is not likely to be called an effective one.

The most important factors, that causes the instability of pangasius market is fluctuation of price. The other significant factor is a vague ecological situation. The price can fluctuate during a month up & down at interval US$1/kg. Penetration of pangasius fillet to the world market of network retail will have troubles if such a situation is preserved.

Sure thing, the resistance competition between Vietnamese producers of pangasius also causes the instability. So, let’s say, from March to June 2007, the prices for pangasius dropped by €0,40/kg. The likewise decrease of the processes’ profits has an impact on revenue of farmers breeding pangasius. Thus, a deficit of feedstock comes into existence.

Source: IRUE "National center of marketing and price study"


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