Impact of the Covid-19 Pandemic on Tra Fish Industry
The Covid-19 pandemic has significantly affected the global seafood industry, leading to a reduction in consumption and a decline in orders by 35-50%. Vietnamese tra fish companies, located along the Mekong and Bassac rivers and near the Cambodia border, have faced losses due to falling export prices and lower orders. These companies have shifted their focus to the domestic market in response to the pandemic.
Struggles Faced by Tra Fish Exporters
Vietnam Association of Seafood Exporters and Producers (Vasep) reports that tra fish has been one of the most affected seafood products, with export turnover dropping by over 31% in the first half of the year. The decline in new orders, high inventories, and low export prices have severely impacted the profitability of businesses operating in this sector. Social distancing measures implemented in April disrupted international trade, leading to raw material shortages, transportation difficulties, payment challenges, and a lack of capital to sustain operations.
Vinh Hoan Corp’s Profit Reduction and Investment Strategies
Vinh Hoan Corp (VHC), headquartered along the Mekong River in Dong Thap province, saw its second-quarter profit halve to 215 billion dong ($9.25 million) compared to the previous year. The company is exploring investment strategies to increase profitability through value chains. In addition to traditional tra fish exports, VHC aims to boost sales of fish fat, fish meal, collagen, and gelatin products by expanding its operations and investing in a new factory.
Challenges Faced by Nam Viet Corp and Its Domestic Market Focus
Nam Viet Corp (ANV), located along the Bassac River in An Giang province, experienced a 79% year-on-year decrease in second-quarter profit, reaching its lowest level since 2017. The company has shifted its focus to the domestic market and is collaborating with VinEco, an agricultural unit of the conglomerate VinGroup under Masan Group, to explore domestic distribution opportunities.
IDI and ACL’s Struggles and Efforts to Overcome Challenges
IDI International Development & Investment Corp (IDI) reported a 61% drop in second-quarter profit due to the heavy impact of the pandemic on frozen fillet production and export. Cuu Long An Giang Seafood Import-Export JSC (ACL) also faced significant profit reductions in the second quarter. These companies are working on expanding their export markets and establishing partnerships with farming households to achieve greater self-sufficiency in raw material supply.
Mekong Fisheries JSC’s Losses and Market Developments
Mekong Fisheries JSC (AAM), located downstream along the Bassac River, suffered a loss in the second quarter as export turnover decreased by half compared to the same period last year. AAM is determined to expand export markets and aims to meet 95% of its raw material needs through partnerships with farming households.
Vietnamese tra fish companies have encountered significant challenges due to the Covid-19 pandemic, resulting in falling export prices, decreased orders, and disruptions in international trade. To mitigate the impact, companies are diversifying their strategies, focusing on the domestic market, exploring value chains, and expanding their product offerings. Although the industry faces obstacles, market developments and efforts to adapt to changing circumstances provide hope for the future.