The year 2023 posed significant challenges for Vietnamese shrimp exporters as they faced high inflation in various export markets, reduced purchasing power, falling shrimp prices, and tough competition from major players like Ecuador and India, according to the Vietnam Association of Seafood Exporters and Producers (VASEP). However, while exporting to the US and Europe appears to be a challenging endeavor, Vietnam has the opportunity to increase its presence in the Chinese, Japanese, and Korean markets.

Challenges in 2023

In 2023, Vietnam’s shrimp exports experienced a substantial decline of 22%, reaching USD 3.4 billion compared to the previous year. This decline was primarily attributed to factors like high inflation in export markets, weakened purchasing power, and fierce competition from Ecuador and India.

China: A Glint of Hope

Although shrimp exports to China also declined in 2023, there is optimism for 2024. China’s demand for imported shrimp continues to rise, albeit facing an oversupply from countries like India and Ecuador. Nevertheless, Vietnam holds a geographical advantage in terms of transportation costs, which could be a game-changer. The recent increase in shipping costs due to the Red Sea conflict may put pressure on Ecuador’s exports to China, creating an opportunity for Vietnamese shrimp.

Bright Prospects in China for 2024

In 2024, the prospects in China look brighter for Vietnamese shrimp exporters. Ecuador’s internal issues have led to stagnant production and export challenges, while shipping congestion in the Red Sea further hampers Ecuador’s access to the Chinese market. As a result, Vietnam is poised to gain a larger market share in China, especially with the strong demand for black tiger and whiteleg shrimp.

US and Japan: Cautious Optimism

Shrimp exports to the US and Japan are expected to show signs of recovery in 2024. The US market is projected to grow slightly as food demand improves, inflation stabilizes, and retail sales recover. Despite the presence of competitively priced processed shrimp from India and Ecuador in the US, Vietnamese shrimp products such as breaded, stretched, fried, and sushi shrimp continue to enjoy popularity due to their quality and meticulous processing.

Difficulties in the US and EU Markets

While there are positive indicators, the US remains cautious due to geopolitical risks, including the conflict in Ukraine, which could disrupt the grain market and push inflation upward. Additionally, the American Shrimp Processing Association (ASPA) has requested an investigation into anti-subsidy taxes on imported shrimp, potentially affecting Vietnamese exports in the first half of 2024. Increased shipping rates to the US stemming from Red Sea tensions are also a concern for exporters.

In the EU, 2023 witnessed a significant decline of 39% in shrimp exports, with Ecuador and India as key competitors. Nonetheless, Vietnam’s advantage in the high-end segment helps maintain its foothold in this market. Economic and political instability is expected to hinder the EU market’s recovery for most of 2024, but demand is expected to remain stable without further decreases.