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Vietnamese imports into the United States have experienced a smaller decline on a monthly basis compared to the overall shrimp decline in imports. If this trend continues, the U.S. market is expected to recover early from July onwards.
According to data from the Vietnamese Customs, as of June 15, 2023, Vietnamese shrimp exports to the United States reached $257 million, a 41% decrease compared to the same period in 2022.
According to the analysis by Ms. Kim Thu, a shrimp industry expert from the Vietnam Association of Seafood Exporters and Producers, Vietnamese shrimp exports to the United States started to decline in the second half of 2022. High inflation, tightened consumer spending, and the preference for cheaper food choices have contributed to this decline.
During the post-Covid-19 period in the first half of 2022, there was an unprecedented increase in demand and consumption of shrimp in the United States. However, this led to high inventory levels and an imbalance in supply.
In the early months of this year, shrimp-producing countries such as India and Ecuador entered their harvesting season, resulting in increased supply and decreased shrimp prices. Additionally, the continued increase in interest rates by the United States has negatively impacted the shrimp import demand in this market.
However, when looking at the monthly export figures, it seems that the U.S. market is gradually showing positive signals. Shrimp exports to the United States in May 2023 reached $68 million, the highest level so far this year. Although it still experienced a negative growth of 31% compared to the same period last year, this is the smallest decline compared to previous months.
Mr. Dang Quoc Cuong, the Sales Director of Thong Thuan Co., Ltd., a large-scale shrimp processing and exporting company in Ninh Thuan province, stated that the company annually handles seafood export procedures with a value of approximately $100 million. However, this year, there has been a significant decrease in shrimp consumption in the United States and the EU. Through practical market research, the company has observed the real difficulties in these markets.
Regarding export orders in 2023, Mr. Cuong believes that exports in the early months of 2023 have decreased by about 40%. The company is now focusing on producing goods for the second half of the year, as it expects export demand to recover, especially in the U.S. market.
The average import price of shrimp into the United States in the first four months of this year was $8.3 per kilogram, a 14% decrease compared to the same period last year ($9.6 per kilogram). The reduction in selling prices due to inventory clearance has led to increased competition and price pressure for newly imported shrimp, which has contributed to the significant decline in Vietnam's shrimp exports to the United States.
Statistics on shrimp imports from Vietnam to the United States show a continuous increase for three consecutive months, with each month surpassing the previous one. Imports increased from 2,423 tons in February 2023 to 2,845 tons in March and further rose to 3,665 tons in April. The decline in shrimp imports from Vietnam into the United States on a monthly basis has been less significant compared to the overall decline in shrimp imports. Ms. Kim Thu predicts that if this trend continues until June, the U.S. market is expected to recover early from July onwards.
According to Ms. Kim Thu, the cold storage facilities in the United States are gradually being depleted, and importers, retailers, and wholesalers will begin considering increasing their shrimp imports again. This will push shrimp prices higher, and it appears that shrimp prices have reached their bottom. The consumption of shrimp during year-end festivals is also expected to increase. The availability of vessels and containers is favorable for exporters. Based on collected data, it is estimated that non-cultivated shrimp ponds in India account for approximately 30% to 50%, and in Ecuador, the El Nino phenomenon has caused damage to around 30% of shrimp farming areas, resulting in reduced shrimp production. These factors provide a more optimistic outlook for shrimp exports to the United States in the coming months.