Vietnam is among the six largest producers and exporters of shrimp in the world but is facing fierce competition from India and Ecuador.

Without policies to reduce production costs in the next five years, the local shrimp sector will be at risk of failing to compete with its rivals.

Pressure from Ecuador, India

Ten years ago, only a few Vietnamese shrimp producers and exporters mentioned Ecuador as a potential competitor.

However, the South American country is now the largest shrimp producer in the world and may become the biggest rival of Vietnam’s shrimp sector in the upcoming years.

Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said that Ecuador has dominated the global market of whole shrimp, taking Vietnam’s market shares, over the past three to four years.

Ecuador’s shrimp also accounts for up to 60 percent of the Chinese market’s shrimp imports.

According to local shrimp enterprises, Vietnam has advantages in processing and strategies to access markets. At present, Vietnam has the highest processing capability among shrimp exporters worldwide.

Six countries farming a high volume of shrimp are Ecuador, India, Vietnam, China, Indonesia, and Thailand. The development of the shrimp sector in Ecuador and India has caused a great impact on Vietnam.

Dr. Ho Quoc Luc, chairman of Sao Ta Foods JSC, said that Ecuador’s shrimp volume was much lower than that of Vietnam four years ago, but it now achieves the leading position in the world.

Over the past three to four years, Ecuador has reformed its shrimp sector, firstly successfully studying high-quality breeds.

To solve the shortage of processing workers, Ecuador employs laborers from neighboring countries.

It has also shifted from whole shrimp and frozen headless shrimp to higher value-added products.

Therefore, Ecuador does not rely much on China but has access to choosy markets, such as the U.S..

With its favorable geographical position and low transport costs, Ecuador’s shrimp has been exported stateside and currently makes up a 20-percent market share there.

The trend will continue, which is a concern for Vietnam’s shrimp sector.

Ecuador has a large shrimp farming area meeting Aquaculture Stewardship Council (ASC) standards as most of its farms are large. 

Meanwhile, most shrimp farms in Vietnam are small and unsystematic, so Vietnam must pay more attention to the development of the sector, Luc said.

Stronger efforts required

According to VASEP, shrimp is expected to fetch US$6 billion in export revenue by 2025. However, the sustainable development of the sector requires greater efforts.

Experts said that it is vital to produce high-quality shrimp breeds as the success rate of shrimp farming in Vietnam is just under 40 percent, lower than the 55 percent in Thailand and the 47-48 percent in India.

VASEP general secretary Hoe informed that the farming area of white-leg shrimp is equal to a quarter of that of black tiger prawns but the export revenue of the former is 5.5 times higher than the export turnover of the latter.

The farming areas of these two kinds of shrimp need to be adjusted to meet the demand of the market.

In addition, it is required to issue policies to gather land and encourage the investment in shrimp farming to increase farms’ productivity and reduce risks and selling prices of shrimp products.

According to VASEP, Vietnam exported over US$3 billion worth of shrimp in the January-August period of this year, up 24 percent year on year.

The largest importers of Vietnam’s shrimp were the U.S., Japan, China, South Korea, and Australia.

The Directorate of Fisheries informed that Vietnam set targets of 750,000 hectares of shrimp farms this year, including 625,000 hectares of black tiger prawns and 125,000 hectares of white-leg shrimp.

In addition, the shrimp output is expected to hit some 980,000 metric tons, and the shrimp export revenue is targeted at $4 billion, up 2.56 percent versus 2021.

To reach these targets, the Directorate of Fisheries required enhancing the application of advanced technology to improve the productivity and the quality of products, meeting the demand of the local and foreign markets.

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