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December 25, 2007

Tiger shrimp producers urged to lower costs

Experts have warned that the popularity of Vietnam's tiger shrimp on the global market has been challenged by white shrimp and the only way of improving its competitiveness is by lowering the production cost.

In 2007, Vietnam is expected to export US$3.6 billion worth of seafood, including US$1.5 billion from shrimp exports, an increase of 12 per cent over the same period last year. However, Vietnam may not maintain this high growth rate next year, as Vietnam's tiger shrimp is competing with increasingly popular white shrimp.

In previous years, tiger shrimp prices always increased by 10-20 per cent in the final months of the year, especially right before Christmas. However, tiger shrimp prices have been decreasing this year. Importers nowadays prefer the cheaper white shrimp to Vietnam's more expensive tiger shrimp.

On the US market, the white shrimp price is US$1-1.5/kg earning it 80 per cent of the market share, while Vietnam's higher cost tiger shrimp retains only 20 per cent.

Le Van Quang, Deputy Chairman of the Vietnam Association of Seafood Exporters and Producers (VASEP), said that in order to make tiger shrimp more competitive Vietnam has no other choice than to lower the production cost. Mr Quang stressed production cost must be reduced to VND50,000(US$3.11)/kg to compete with white shrimp. In order to reduce the production cost, they have to implement the latest shrimp hatchery technologies.

Pham Minh Tien, Director of the Seafood Department of Soc Trang, a province boasting 49,000ha of tiger shrimp hatcheries, said there are three major shrimp production responsibilities and challenges. The first is quality and hygiene. The second is environmental pollution caused by massive development of shrimp and catfish fields. The third is high production cost.

Courtesy Xinhua

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