Vietnam: Draft of National Seafood Processing Development Plan towards 2020 released!!

Though spontaneous, the development of seafood processing industry has made great contributions to promote agriculture and fisheries development, thereby making positive changes to rural areas, creating more jobs and higher incomes for the locals.

The industry, however, will play more important role when its development is schemed.
The 2009 statistics showed that seafood industry accounted for 4% of the nation’s GDP and 19.8% of the agricultural sector’s GDP. Seafood was the third largest export item of Viet Nam, after crude oil and garment & textile, accounting for 11% of the country’s export turn- over, providing jobs to over 1 million people or 4% of the country’s total labour force. There were as much as 568 industrial scale seafood processing plants all over Viet Nam.
“The lack of planning has led to the unbalance between the seafood processing capacity and raw material supply, the increased competition among processors, the unstable and unsustainable production, the low quality of raw materials, the backward processing technology, and the lack of linkage between seafood processors and material producers, etc,” evaluated Dr. Tran Thi Dung, Director of Center for Consulting and Fisheries Development Planning.

In this situation, the draft National Seafood Processing Development Plan towards 2010 has been developed by the Department of Processing and Trade for Agro-Forestry-Fisheries Products and Salt Production to lay the foundation for the fast, sustainable and effective development of the seafood industry.

Seafood export growth to slow down
In the coming years, the global seafood consumption is predicted to increase by 1.5% per year with more high-valued seafood being consumed in developed countries and the inexpensive one in developing countries. China will become a significant seafood importer rather than an exporter. Developing countries will still be major seafood exporters, among which Latin American and South East Asian countries being key shrimp exporters. The price of exported seafood will rise by 4- 18%/per year on average compared to 1987.
However, the growth of Vietnamese seafood export will slow down, from the previous double-digit number to 5-6% per year. Shrimps will still be the largest export product, followed by fish, and mollusk. Seafood import will grow by 8-10%/year to meet the domestic consumption and export processing demand.
“The domestic seafood consumption will increase dramatically in the next decade. The population of urban dwellers is rising and so is the demand for seafood of higher value. Nevertheless, most consumed products will still be the common inexpensive fish supplied on the spot and fresh. Seafood products will be consumed with a higher quantity in big cities where lots of restaurants and hotels are located and high-salaried workforce live. The consumption of raw products will be lessened while that of processed ones will increase,” Dung predicted.
The import of materials for export processing will increase because developed countries are outsourcing to Viet Nam to make use of cheap labor. Vietnam is forecasted to import about 500- 700,000 tons of seafood of all kinds, chiefly shrimp, cold-water fish, squid and octopus to serve both domestic consumption and processing for export.
Factories to be modernized
Predictably, there will be twotendencies of seafood processing technology development.  Firstly, when reaching a certain advancement level, developing countries will gradually adopt the value added processing technology from developed countries.
Secondly, low temperature will be used in preservation to improve product quality. Liquid ice (slurry) will replace block or flake ice to increase preservation efficiency. Liquid nitrogen will be used more frequently in tuna preservation to maintain sashimi grade.

 These trends will give rise to the number of new state-of-the- art seafood processing facilities. Larger and more competitive seafood groups will appear via the merge of small businesses. More processing stages will be automated to reduce the labour intensity. Greener production technologies will be increasingly applied to meet the international requirements on social responsibilities and environmental protection. Seafood products will be more diversified and more appealing. The development of seafood processing industry will drive the development of supporting industries, especially the human resources training.
The domestic market is also expected to be more fascinating because forecasts show that by 2020, the average income per capita will increase to US$2.000 per year and the seafood consumption per capita will rise by 40-45% in comparison with 2007 to 22 kilograms.
Planning scenarios
All scenarios reflect the same developmental standpoint. Firstly, seafood export is seen as the impetus behind, fisheries and logistic development. Secondly, processing will become more complicated and require less raw material input. Thirdly, processing development will be based on expanded raw material area, strengthened linkage with fishermen and farmers, and systematically control of product quality and food safety. Fourthly, priority will be given to processing for domestic consumption and the establishment of village-based industrial clusters.
Among the three scenarios developed, the second one was selected, which forecasts the seafood export volume will increase by 3.44% annually to reach 1.9 million tons by 2020. The export value will grow accordingly by 5.92% to US$8 billion. The amount of seafood processed for domestic consumption is expected to reach 0.94 million tons, worth VND19, 240 billion, an average increase of 3.44%/year and 4.57%/year respectively.
“We’ve selected this ambitious scenario believing that if both the central government and the local authorities make efforts to support businesses, it will be feasible,” said Dr. Dung
With this scenario, the required investment for the next 10 years is estimated to be around VND24,086 billion, including VND11,904 billion for the first phase (2011-2015; state budget is VND1,407 billion, accounting for 11.8%, the rest come from loans and self-financing) and VND12,182 billion for the second phase (2016-2020; state budget is VND1,610 billion, accounting for 13.2%). Businesses in the North and Central region will enjoy soft loans for projects on upgrading factories, building cold stores. Also, investment supporting mechanism will be applied to businesses building new factories in the industrial zones, etc.
Source: Vietfish international
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