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Measures to Develop Seafood Processing Industry in Mekong Delta

Processing Economics Politics +3 more

VIET NAM - The Mekong Delta produces 3.2 million MT of wild caught and farmed fish species per year, providing a huge supply for the regional export-driven seafood processing industry. However, the industry has not met its potential so far.

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There are now 276 seafood processing companies in Mekong Delta, representing 47 per cent of total number of seafood companies in Viet Nam. These processors own 235 processing plants with total production capacity of 1.2 million MT per year, accounting for 86 per cent of nationwide frozen seafood production, reports VASEP.

Seafood products from Mekong Delta are sent to 165 countries and territories, in which there main markets are the EU, Japan, the US, Canada, Brazil, South Korea, China to bring back an annual revenue of $5 billion.

Besides exports, seafood sales in domestic market are also highlighted. Many products are processed with high quality and eye-catching designs to meet demands of local consumers. The fish processing creates jobs for millions of local labours in Mekong Delta, consisting of a momentum for the development of fishing and aquaculture activities.

However, raw products still make up a huge proportion in fish production of the region. Currently, frozen pangasius fillets make up of 90 – 98 per cent of total pangasius exports. The proportion of value-added items is at 30 – 50 per cent of total sales of shrimp, cephalopod and other marine products. The situation reflects that the Mekong Delta's processing industry could be more invested and developed.

In addition, the building of brand name with geographical indication and country of origin for some key export items such as organic shrimp, pangasius, clam, blood cockle, crab were not focused by many producers and exporters.

Due to season-depending raw material supplies, local fish processors sometimes face to lack of raw fish for production. Lack of master planning leads to some crises in raw fish supply, negatively affecting to fish production.

Development orientations

Experts say that from now to 2020, Mekong Delta should focus on developing seafood processing industry through implementing comprehensive and sustainable planning on the base of closed links among all stakeholders in the industry. Furthermore, a network of all seafood producing hubs is also needed to set up to share information and profit throughout the value chain.

Data on raw material supply, consumer markets, pricing and policies must be available to provinces and seafood companies in order to help them timely updated trends and challenges in the market to find flexible and efficient measures to maintain and expand business. Mekong Delta-based provinces need to cooperate in trade promotion and investment attraction in order to build up the brand name with geographical indication key exported seafood such as pangasius, black tiger shrimp or tuna. It is also important to put focus on quality management in the whole production chain.

To reach these targets, Mekong Delta should mobilize the participation of local authorized agencies, fishery associations and companies, and representatives of farmers to build up a center for fishery development in Can Tho city, which is linked with Mekong Delta's fish farming areas and a fishing hub in Kiên Giang. These two hubs will not only create links among provinces' fish producing and trading activities but they also attract foreign investments and ODA funds into regional fishery sector.

For stabilize seafood processing activities, Mekong Delta provinces must strictly control of the investment flow in local processing plants to avoid waste of production capacity of plants through reviews of the planning on sustainable large-scale raw material producing areas as well as investments in building modern processing plants.

Besides, investments in technologies and modern equipments are important to boost the production of value-added products, raising the competitiveness of Mekong Delta seafood. Local export companies are required to control the quality of products in compliance with quality and food safety standards.

Mekong Delta plans to build a center for market research and information in Can Tho to support seafood production and trading activities in the region and beyond. A new center for trade promotion will also be set up to support for promoting seafood products in international markets.