Vietnam’s shrimp exports to the US started a downward trend from the second half of 2022. Inflation increased, people tightened spending, and chose more affordable products
In the post-Covid period in the first half of 2022, the demand and consumption of shrimp in the US increased unprecedentedly, however, causing high inventories and supply imbalance.
In the first months of this year, producing countries such as India and Ecuador entered the harvest season, supply increased, and shrimp prices decreased. In addition, the continued US interest rate hike has negatively impacted the shrimp import demand of this market.
However, looking at the monthly export sales, it seems that this market is showing signs of recovery. Shrimp exports to the US in May 2023 reached $68 million, the highest level since the beginning of the year. Although it was still a negative growth of 31% compared to the same period last year, this is also the smallest decrease compared to the previous months.
Looking at the monthly export sales, it seems that the US market is showing signs of recovery.
According to data from the Department of Foreign Agricultural Affairs (belong to USDA/FAS), US shrimp imports in April 2023 decreased for the 10th consecutive month. Accumulated in the first 4 months of this year, US shrimp imports reached 237,377 tons, worth 2 billion USD, down 18% in volume and 29% in value over the same period in 2022.
The average price of shrimp imports into the US in the first 4 months of this year reached 8.3 USD/kg, down 14% over the same period last year (9.6 USD/kg). The price of products from the sold inventory was low, creating more pressure for new imports, depressed pricing for new imports, contributing to the significant decrease in Vietnam’s shrimp export turnover to the US.
Statistics on the volume of shrimp imports into the US from Vietnam show that shrimp imports from Vietnam have recorded an increase for 3 consecutive months, the following month is higher than the previous month, from 2,423 tons in February 2023 to 2,845 tons in March and to 3,665 tons in April. Shrimp imports from Vietnam into the US in each month also recorded a decrease less than the overall decrease in US shrimp imports. If this trend continues until June, the US market is considered to be able to recover soon from July.
In April 2023, a number of Vietnamese shrimp products imported into the US recorded growth compared to March 2023, such as shell-on shrimp increased by 211% compared to March 2023, peeled shrimp shrimp increased by 46%, and cooked and breaded shrimp increased by 13% and 20% respectively.
In the first 4 months of this year, in the structure of imported shrimp products from the US, the volume of peeled shrimp decreased by 11%, breaded shrimp by 30%, and cooked shrimp by 28% compared to the same period last year.
Cold storage in the US is dwindling, US importers, retailers and wholesalers will start to consider increasing imports again. This will drive shrimp prices higher and it looks like shrimp prices have bottomed out. Shrimp consumption for year-end festivals is also expected to increase. The supply of ships and containers is in a favorable state for exporters. According to the collected data, the amount of hanging, non-cultivated ponds in India ranges from 30% to 50%. In Ecuador, EI Nino is causing damage to about 30% of the farming area, the amount of shrimp will decrease. These can be considered as the basis for a more optimistic forecast of shrimp exports to the US in the coming months.
Source: Vasep, 2023