Thanks to investment in deeply processed products, Vietnamese seafood still stands strong, even accounting for a large market share in many demanding markets such as Japan and the US.

Sweet fruit from deep processing

Orders in the first months of the year increased by more than 50% over the same period, Mr. Vo Van Phuc - General Director of Vietnam Clean Seafood Joint Stock Company said; Inventories in key markets have been cleared, customers from the US and Europe increased orders in the first months of the year.

This result is due to the increase in deeply processed products. Currently, the enterprise's processing factories are busy preparing for existing orders, focusing on orders for deep processing, such as steamed shrimp, fried shrimp...

Similarly, Mr. Ho Quoc Luc - Chairman of the Board of Directors of Sao Ta Food Joint Stock Company said; With shrimp products, among the 6 largest shrimp exporting countries in the world, currently only Vietnam and Thailand have reached the highest processing level, which is deep processing.

Thanks to that, despite being under great competitive pressure from cheap shrimp from India and Ecuador, Vietnamese shrimp still stands firm, even accounting for a large market share in many demanding markets such as Japan and the US.

“Even though the market price of shrimp has dropped sharply, thanks to focusing on deeply processed orders such as steamed shrimp, breaded shrimp, and fried shrimp, the business has minimized business difficulties. Along with that, proactively sourcing raw materials helps businesses increase the competitiveness of their products," Mr. Luc emphasized.

Not only shrimp, with pangasius products, many businesses are also choosing a strategy to focus on deeply processed products. According to businesses, in a not very positive market context, value-added products will be less affected by challenges from supply and demand.

Mainly exporting processed pangasius products to Japan, Korea, Singapore and Malaysia, Mr. Nguyen Van Dao - Chairman of the Board of Directors, General Director of Go Dang Joint Stock Company (GODACO) said; Thanks to shifting to value-added products such as breaded, seasoned pangasius fillets and other products from pangasius, the business has overcome difficulties from the import market. Currently, value-added products account for 10-20% of the unit's revenue and are expected to increase to 30% in the future.

According to Mr. Dao, value-added pangasius products are less competitive than conventional products because few people can make them. Therefore, the value and profit are also higher. However, investing in deeply processed products also has limitations: it requires more promotion and marketing of the product. Meanwhile, with Vinh Hoan Joint Stock Company, in addition to breaded pangasius fillets, the business also combines many different products to create seafood and vegetable noodle dishes. Besides, Vinh Phuoc Company - a subsidiary of Vinh Hoan Joint Stock Company has also succeeded in expanding into salmon processing to serve Japanese customers. In addition, collagen and gelatin products are still growing better than other products. According to the plan, in the short term the business will not focus on investing in expanding pangasius farms due to market fluctuations and needs to plan production and processing to suit market demand.

Continue to reduce costs and improve competitiveness

Vietnam Association of Seafood Exporters and Producers (VASEP) said; Reality from recent market fluctuations shows that choosing to focus on processed products and increasing added value is a suitable business strategy for businesses. Therefore, there is a shift in product structure in each key export industry.

Typically, in the first quarter of 2024, while frozen pangasius fillet exports decreased by 5%, value-added processed products increased by 16%. Notably, by-products such as pangasius maw and fish skin snacks both recorded double-digit increases.

Ms. Le Hang - VASEP Communications Director acknowledged that in markets such as the US, EU, and Japan, value-added products are Vietnam's advantage. In the context of inflation, inventories continue to impact seafood consumption and imports in many markets, maintaining the strength of processing.

“In the context of seafood export still having many challenges, in the coming time, businesses need to improve processing levels and diversify products to attract consumers and maintain high-end market share segments. For example, shrimp processing enterprises can make dumplings, shumai...; Pangasius businesses make more agricultural products, more cakes... These are deeply processed products, bringing high value to businesses," VASEP representative acknowledged.

Source: VASEP