China ripe market for local tra fish exporters

Vietnam’s tra fish exports have increased sharply in recent years.- Photo bnews.vn

China’s reduction of import duties on 221 seafood products came into effect from July 1 for members of the World Trade Organisation. Of which, the import duty would drop to 7 per cent for catfish fillets and fresh or chilled catfish from 10 per cent and from 12 per cent, respectively.

The tax reduction is an opportunity for Vietnam’s companies exporting tra fish to China to increase profits. It would also promote exports, especially the exports of large traders and companies, to this country, the largest export market of Vietnamese tra fish at present.

Currently, tra fish exports from large traders and companies must include value added tax at 17 per cent and import duty, while tra fish traded by smaller firms and households at border gates do not have to impose those duties.

Therefore, the reduction of import duty for this product would encourage large Vietnamese traders and companies to sign export contracts for tra fish, avoiding risks in export activities for tra fish products, reported Nong nghiep Vietnam (Vietnamese Agriculture) newspaper.

In addition, the US-China trade dispute is also considered an opportunity for Vietnamese enterprises to promote tra fish exports to both markets.

Truong Dinh Hoe, VASEP general secretary, said China is not only a promising market due to its large population but also has many dishes. Meanwhile, tra fish is suitable for processing in hundreds of different dishes.

Therefore, Vietnam is likely to increase exports of value added tra fish products to this market, Hoe said.

VASEP statistics showed that in the last five years, Vietnam’s catfish exports to China have shown strong growth, with a rate of 21-31 per cent per year.

In the first five months of this year, Vietnamese tra fish export value to China reached $174.3 million. With this figure, tra fish had the largest export value to China among seafood products.

However, the tra fish exports as part of large contracts to China face many challenges. Of which, China has different regulations for seafood products compared to other large export markets of Vietnamese tra fish, such as the EU.

China has enhanced quality control with tra fish imported under commercial contracts but has not paid attention to the quality of tra fish imported through border gates.

According to VASEP, over the past 10 years, Vietnam’s seafood exports to China have had stable growth. This is one of the few markets with positive growth. China holds huge potential for Vietnamese seafood products while major seafood export markets of Vietnam have reduced in volume.

In 2017, China was the fourth largest market for Vietnamese seafood, with an export value of $1.33 billion, accounting for 15 per cent of total seafood export turnover.

During the first six months of this year, seafood exports to China, including Hong Kong, were estimated at $586.494 million. Thus, China overtook the EU to become the third largest export market of Vietnamese seafood after the US and Japan.

China is considered an important export market of Vietnamese seafood products in the future. This is a potential market but it also has many risks if local businesses do not pay attention to quality and brand names of products, according to VASEP.