Agricultural exporters turn to domestic market as global demand slumps

With global demand weakening, many seafood and agricultural exporters are turning to the domestic market.

Data from the Ministry of Agriculture and Rural Development shows seafood exports in the first half of this year plummeted by 27% year-on-year to US$4.13 billion.

Pangasius fish saw the biggest decline of 38% to $885 million. Many exporters have been eyeing the domestic market as a result.

Pangasius steak export

The director of a seafood exporter in Phan Thiet in the central Binh Thuan Province said his company only produced two or three items for the local market last year but has double that number now, and they are at supermarkets across the country.

It is expanding distribution both online and offline, he said. “Our company’s domestic sales increased by 20% in the first six months of the year, partly offsetting the decline of over 25% in exports.”

The CEO of seafood exporter Navico, Doan Toi, said his company’s seafood exports decreased by 15-20% in the first half as the Chinese market, a big importer of Vietnamese pangasius, cut imports due to post-Covid difficulties.

Navico has tied up with retailers such as Lotte, Mega Market and Bach Hoa Xanh to expand local sales.
In the last three months the Bach Hoa Xanh chain has bought 600 tons.

“This is an impressive number when overall sales are declining,” Toi said.

Director of Huy Long An Company, Vo Quan Huy, inspects bananas at its processing plant in the southern Long An Province. Photo by VnExpress/Thi Ha

Exporters of agricultural goods are also increasingly focusing on the domestic market. Vo Quan Huy, director of Huy Long An Company, said he had focused completely on the export market to the exclusion of the domestic one.

But this year he has tied up with many supermarkets and other retailers to boost local sales. Vietnam has 100 million people who are increasingly willing to spend money for high-quality products, he said.

Acknowledging this trend, Le Hang, communications director of the Vietnam Association of Seafood Exporters and Producers, said in the past few years businesses have considered the domestic market a “salvation.”

Nong Van Dung, purchasing manager of Bach Hoa Xanh, said his company is tying up with cooperatives and exporters, including those growing fruits and vegetables.

According to data from the General Statistics Office, retail sales of goods and services were worth over VND3,000 trillion ($127.1 billion) in the first half of this year, up 10.9% year-on-year.