Dominate big cities
According to Truong Dinh Hoe, General Secretary of Vietnam Association of Seafood Exporters and Producers (VASEP), Vietnam previously exported whole tra fish to some provinces in the southern border of China, but now tra fish fillet products are present in major cities such as Beijing, Shanghai and Dalian. Chinese demand for tra fish products will be even higher in the coming time.
The increasing popularity of Vietnamese tra fish fillets in China occurs at an appropriate time. Vietnamese tra fish exporters are subject to a higher anti-dumping tax rate than previous announcement of the US Department of Commerce (DOC). This ruling creates a complicated scenario for Vietnamese exporters at that time, those who were not sure of the tax rate that the US would impose on Chinese tilapia export products.
Currently, domestic tra fish exporters are benefiting from the US - China trade war with big importers shifting to import Vietnamese tra fish products, this fish has been favored and accepted by American consumers.
In the last 10 years, China has emerged as a market specializing in importing seafood instead of exporting as before. According to VASEP, the Chinese market has a great opportunity but still has many potential risks because China is tightening inspection on food safety and strictly control cross border trade.
China's seafood import demand has increased steadily every year with over 3 million ton per year. Chinese consumers prefer imported products and natural exploitation due to food safety concerns. In particular, they are willing to spend money to buy products that are accepted by the US and European markets. Typically, Vietnamese tra fish products have increased consumption in China since being accepted at the US market
Leading export of tra fish
Vietnam is the largest tra fish producer in the world, with output reaching 1.25 million in 2017 and increasing to 1.33 million tons in 2018. India is the second largest exporter with a production of 540,000 tons in 2018, followed by Bangladesh with 455,000 tons and Indonesia with 110,000 tons.
China is rapidly catching up with the EU as the world's largest seafood importer. This country imported nearly 5 million tons of seafood in 2018, according to Rabobank. “Tra fish is a really good choice for Chinese customers who are looking for whitefish products” - Mr. Truong Dinh Hoe said. One of the challenges that Vietnamese tra fish exporters have to overcome is to create trust for Chinese customers to buy fillets instead of whole tra fish. According to World Bank data, China's GDP per capita increased from US$ 3,471 in 2008 to US$ 8,827 in 2017. Meanwhile, Vietnam's per capita GDP increased from US$ 1,143 to US$ 2,342 at the same period. This shows that Vietnam's labor costs are now much cheaper than China. This means that Vietnamese tra fish enterprises are selling fish at a more competitive price to the Chinese market.
Currently, seafood export to China is conveniently boosted with low expense. Almost all seafood export enterprises in the South of Vietnam have moved from road freight transport to sea transport. Moreover, while cross border trade by road freight transport hides many risks for exporters, official export by sea transport helps export enterprises limit payment risks, assure product quality and save costs.
In 2019, it will be an opportunity for enterprises to expand exports by sea transport to major cities of China to improve the quality and quantity of official export. Seafood exports to the Chinese market are forecast to reach US$ 1.5 billion this year, of which tra fish is one of the key products.