The global economic downturn is prompting Southeast Asian seafood producers to explore new markets and consider price reductions to keep business moving forward.
"We should acknowledge and prepare for the challenges this year," said Tran Thien Hai, chairman of the Vietnam Association of Seafood Exporters and Producers (VASEP), at a year-end meeting in Ho Chi Minh City late last week. Seafood exports from Vietnam increased 20 percent in 2008 to $4.5 billion, but are expected to plunge by nearly one-third this year.
Vietnamese producers say price reductions may be necessary because of increased competition in the region, but the rising cost of fish feed has prevented that. The seafood industry has asked the government to cut an import tax levied on imported, unprocessed seafood.
In Bangladesh, shrimp farmers say that buyers in the United States and Europe are pressing them to reduce prices.
"I made a shipment to the USA last month, but the buyers asked me to renegotiate the price, without which he refused to receive the goods," Kazi Belayet Hossain, president of Bangladesh Frozen Foods Exporters Association, told The Daily Star. "If we don't reduce the price, buyers threaten to shift their orders to other countries."
The price of shrimp dropped by $1 per pound in December compared to the late-2007 price. In fiscal 2007-08, the price of 16-30 shrimp ranged between $5.20 and $5.50, but has come down to as low as $4, said Hossain.
The European Union, United States and Japan are the three main markets for Bangladesh's frozen shrimp, with the EU and the United States accounting for 48 percent and 40 percent of the total exports, respectively.
