The amount of raw materials harvested from the wild cannot rise and has even declined. Baseafood and other firms must thus import other countries materials a strategy that is not enough to provide them with sufficient supplies.
According to the Vietnam Association of Seafood Exporters and Producers (VASEP), the shortage, especially of shrimp and tra fish, may last through the end of this year.
Farmed seafood is used as well as wild, yet there is still a shortage because, as some farmers have switched to raising certain animals that fetch higher prices, relatively few are left raising shrimp and basa fish.
Seafood processing factories in Ca Mau province are currently running at just half capacity due to the dearth of shrimp. Consequently, 14 out of 26 factories have had to sever production or request that workers stay home, informed the Department for Agriculture and Rural Development.
Most of the 23 seafood processing plants in An Giang province are also running at just 50-60 per cent capacity because 60 per cent of fish ponds are derelict. The reason is that many farmers have given up their craft due to incurring heavy losses in previous crops.
Meanwhile, as firms resort to importing materials from other countries, production costs get pushed up. Yet, companies are unable to balance rising costs with higher prices due to harsh competition in the market.
A Binh Thuan-based seafood processing company said that Thai enterprises are their main regional rivals, especially regarding products like cuttle fish, cod and tuna.
According to Tuong, his company has changed its business strategy in an effort to circumvent the sectors plight. Baseafood now focuses on manufacturing products with higher added value to cut the volume of materials used while maintaining turnover and profit.
The company has also constructed a large storage system to host extra materials and has replaced much of its wild-caught materials with farmed ones. For instance, its first workshop is using 10 per cent aquaculture materials and that number will soon rise to 30 per cent.
Processors Lack Raw Materials
VIET NAM - Baseseafood needs 20,000-25,000 tonnes of raw materials for processing each year and domestic sources can usually meet only 70 per cent of this amount, Baseafood Deputy General Director Huynh Minh Tuong said.
