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NEWS UPDATES Asean Affairs        8  April 2011

Vietnamese tra fish industry must restructure

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There's a saying among Mekong Delta farmers: tra fish can spawn land. However, at the same time, it can eat it up.

The tra fish industry in the Mekong Delta has for dozens of years gone through many ups and downs.

Once again, tra fish farmers last year suffered great losses due to declining prices, and exhausted farmers cannot afford losses again.

These days in An Giang Province, the centre of the tra industry in the Delta, amid desolate ponds and gloomy floating villages, empty-handed farmers feel an urge to change more than ever. After all, they cannot just call it a day, given that they have been deeply involved in the industry that is so established in the Delta.

So, no mattered how battered they are, farmers and other players in the industry are struggling to find a way out; otherwise they cannot survive.

Given that the fish industry has sufficient experience, techniques and support industries to flourish, most problems are traced back to price fluctuations.

In fact, losses of harvests are rare among fish farmers.

Prices go down when most farmers harvest and sell fish at the same time, or when harvests exceed market demands.

Sadly, such stories have happened over and over again in the Delta.

"Unlike rice farmers who can store rice when selling prices are too low, fish farmers cannot wait for prices to go up at all," said Nguyen Thai Son, chairman of Thuan An, a tra fish processing and exporting company in Chau Thanh District.

"Every single day of waiting costs dozens, if not hundreds of millions of dong (thousands of dollars) in feed to maintain fish," he explained.

"So farmers compete with each other to sell their harvests as soon as possible." Only when farmers' production was regulated can surplus crises be solved, he said, and regulation was only possible when involved parties in the industry were linked together in the value chain.

Thuan An was one of three companies entrusted by the provincial industry association to develop pilot connectivity models towards sustainable development of the industry, he noted, following last year's decision by the provincial People's Committee to sort things out.

Accordingly, farmers, processors, banks and feed suppliers are the four parties that will work together in the value chain.

Fish farmers and processors are the main players at the front of the chain.

Farmers rely on production plans and technical aid provided by processors to work on their own ponds and cages, while processors are required to buy all harvests of farmers.

"We do not fix prices at the beginning, but buy fish according to market prices," said the chairman. "In that way, processors and farmers can share both profits and risks."

However, in a business that requires enormous investment, processors and farmers alone cannot make it without supporting parties like banks and feed suppliers.

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