Big order
The move by Chinese traders to order 500 containers of pangasius from the Nam Viet Joint Stock Company shows once again that the Chinese market has now reopened after 3 years of closure and has ordered in large quantities. This is a large and potential market for Vietnamese agricultural products.
Up to this point, China – Hong Kong is still the second largest market for Vietnamese pangasius products (after the US). In 2022, although the disease was still endemic in that country, Chinese traders imported nearly 300,000 tons of Vietnamese pangasius, with export sales exceeding $700 million.
The characteristics of the market in mainland China are the purchase of goods in bulk, with a wide variety of products and at very good prices. In addition to files, this market also sells pangasius in butterfly cuts, whole (with entrails), cut into pieces, value-added products with fish oil, fish meal, fish skin…
Especially for pangasius files (without chemicals), the export price in this market is currently between 3.5-3.6 USD/kg. This is considered to be the best export price in the context of the current global economic downturn.
Besides pangasius products, China also buys many other agricultural products from Vietnamese farmers, such as dragon fruit, jackfruit, mango, longan, durian… In the past 3 months, Vietnamese durian is in the return season. , Chinese traders have aggressively collected in response, causing the price of durian in gardeners in Tien Giang to rise from 100,000 VND/kg to 170,000 VND and then to 200,000 VND/kg. With such a high selling price, 1 monthong or 6 ri durian, farmers earn over VND 1 billion in revenue.
Ms. Tran Thi Le Dung, a Chinese trader in Vietnam, commented, “The Chinese market is a market like this, but in my opinion, this is a market that we cannot leave. Because the characteristics of this market are buying in large quantities, fast delivery times and fair payment methods. With such purchasing conditions, only companies and corporations with strong economic potential, quality goods production, large agricultural areas and a wealth of experience can receive and fulfill these orders. …”.
Looking back at the development of trade between Vietnam and China, Vietnamese companies that export goods to this market (official export) are mostly rich because once they fulfill a few orders from Chinese traders, Vietnamese companies can grow immediately.
Back to the order that China has ordered 500 containers of pangasius which is 12,000 tons of finished products from Nam Viet Joint Stock Company in An Giang, with this quantity only units with large acreage are available like Nam Viet (600 ha high-tech pangasius- breeding area with a production of 200,000 tons of raw fish per year) with strong economic potential, goods handling experience and good forecasting ability to fulfill large orders. ..
Raw fish is heated every hour
China’s “huge” purchases of goods have caused the raw fish market in the Mekong Delta to “heat up” by the hour in the past few days. The price of pangasius in the pond rose sharply, but the factory could not buy raw fish for processing.
Many pangasius purchasing units in An Giang, Dong Thap, Vinh Long and Can Tho provinces said that the current pangasius price is the same as the stock price, that is, abnormal increase or decrease. Major markets like USA, China – Hong Kong, EU and Asian markets… immediately opened the door for importing goods and raw fish price rose.
Mr. Tran Chi Thien, who is cultivating 1.2 ha of pangasius ponds in Long Hoa Hamlet, Long Gang Township, Cho Moi District (An Giang), which is about to be sold, said: “We look forward to the price for raw pangasius rises to save the farmers. In the past 3 years, the epidemic has been complicated, and the price of pangasius has also been complicated. The fish price is VND 28,000/kg, farmers suffer heavy losses as the breeding cost is up to VND 30,000-31,000/kg (depending on the husbandry conditions of each person, each company). Price increased from VND 28,000 to VND 31,000-31,500/kg, farmers reduced their losses, very satisfied.”
According to Mr. Nguyen Van The, pangasius farmer in An Khanh Township, Chau Thanh (Dong Thap) District, the price of raw pangasius has risen steadily from the beginning of the year until now, before the Lunar New Year the price had risen from VND 28,000/kg in early February In 2023, the price has increased to 31,000 – 31,500 VND/kg and it is expected that the fish price may further increase in the next 3 and 4 months, which will help farmers a lot. because with this purchase price the farmers have saved losses.
Last week, Nam Viet Company in An Giang made a forecast that the fish price could reach 33,000 VND/kg by the end of March 2023. By the end of May 2023, the price might reach its peak of VND 35,000-36,000/kg, so many pangasius farmers in An Giang, Dong Thap and Can Tho City are not selling but waiting for a good price to export.
Mr. Doan Toi, general manager of Nam Viet Joint Stock Company, said that the reason farmers’ farming costs have risen in the past is because pangasius feed prices have risen sharply. As early as late 2019, when the Covid-19 epidemic broke out, supply chains were disrupted, food processing factories (including Nam Viet Joint Stock Company’s Aquatic Food Processing Factory) had to open warehouses to import raw materials at high prices.
Currently, Nam Viet buys bran for food processing, the purchase price is up to VND 8,900-9,000/kg (factory price), while before it was only VND 4,500/kg. Noodle slices 7,300 – 7,400 VND/kg; Soybean 15,600 VND/kg, Burning Rice Husk increased from 800 VND to 1,600 VND/kg. For example, the sharp increase in feed prices makes the cost of raising pangasius rise to 30,000-31,000 VND/kg, fish farmers need to sell fish at 32,000-33,000 VND/kg to make a profit.
China opened the door to importing pangasius in bulk, which greatly excited farmers. From the buying behavior of Chinese traders, it is clear that in order to do business in this market, companies must first have sufficient economic potential, experience in production organization, market data, etc. The ability to respond quickly and comprehensively to orders quantities such as Nam Viet Joint Stock Company can be successful.
In order to avoid risks (as in previous years), fishermen have to organize links with companies through the processing agriculture model.
“China has opened the door to import pangasius in bulk, this is the good news at the beginning of the year for the Vietnamese pangasius industry because since the Covid-19 pandemic in Wuhan, pangasius exports to this market are up encountered many difficulties difficulties. After this market reopened, the price of raw pangasius in the country immediately rose sharply from VND 28,000 to VND 31,000 and then rose to VND 31,500/kg. It is forecast that the price of raw fish will peak again at VND 35,000-36,000/kg by the end of April 2023, like in October 2018…” said Mr. Doan Toi, General Manager of Nam Viet Joint Stock Company.
According to the Vietnam Association of Seafood Exporters and Producers, the Chinese market is the biggest expectation for the Vietnamese pangasius industry in 2023. In addition, the growth of pangasius exports to the ASEAN market is also quite good if the countries in this region are less affected by inflation and gastronomy is recovering strongly thanks to the opening up of tourism. In addition, the market bloc of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is also highly desirable thanks to the benefit of tariff preferences and the stable and positive economic growth of some countries. According to the Vietnam Association of Seafood Exporters and Producers, with the above market trend, Vietnamese pangasius exporters are expected to generate sales exceeding the record $2.4 billion achieved in 2023, although the both traditional markets, the US and Europe, are expected to decline.