Group assignment topic planning to export shrimp from viet nam to the united states

2 1.1.1 General situation of shrimp production in Vietnam 1.1.2 Shrimp production structure 1.1.3 Quality standards 1.2 Importing market...sssssssssscssscssscssssssssssnsessconss

VIETNAM MARITIME UNIVERSITY INTERNATIONAL SCHOOL OF EDUCATION

GROUP ASSIGNMENT

TOPIC: PLANNING TO EXPORT SHRIMP FROM

VIET NAM TO THE UNITED STATES

Haiphong, March 2024

TABLE OF CONTENTS

PART 1 RESEARCH ON THE EXPORTING AND IMPORTING MARKETS 2

I3) ii: 7 2 1.1.1 General situation of shrimp production in Vietnam

1.1.2 Shrimp production structure

1.1.3 Quality standards

1.2 Importing market sssssssssscssscssscssssssssssnsessconssosesssesssssnnsonenssossescosessnaness 7 1.2 MMHTCÍ SỈ C o0 Họ cm họ in lì in mi ti 7

2.1 Trade barriers in the Exporting market ssssssssccssscssscsssssssssesssseeesoees 10

2.1.2 Non-tariff barriers 10 2.2 Trade barriers in the Importing market 11

2.2.2 Non-tariff barriers 12

3.1 Options for international transport 14 3.1.1: Types of transportation and advantages and disadvantages of each form of

transportation 14

PART 5 PROFLT ESTIMA TION nh nh nan hư 27

FD, OÍ, GHI TH 0 T0 00 0 sự 27 5.2 Profit weve 27

Page 1

LIST OF PICTURES

Picture name Page

Picture 1.1.2.2 | Exporting seafood in early 2023 4

Picture 1.1.2.3 | Vietnam's shrimp export market tn 2023 4

Picture 1.1.2.4 | Vietnam's shrimp import market in 2022 5

Picture 1.1.2.5 | Vietnam shrimp export market structure in 2023 6

Picture 3.1.1.1 | Transporting shrimp by waterway 14

Picture 3.1.1.1 | Transporting shrimp by road 15

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PART 1 RESEARCH ON THE EXPORTING AND IMPORTING MARKETS 1.1 Exporting market

1.1.1 General situation of shrimp production in Vietnam

Fisheries is one of Vietnam's major economic sectors with an average contribution of 9- 10%/year to the country's total export turnover

Vietnam enjoys several benefits to expand the fishing sector in both fishing and

agricultural operations, including a thick river system with 112 estuaries and streams and

a coastline spanning more than 3,260 km Because of its high agricultural productivity and capacity for production, shrimp has emerged as Vietnam's primary seafood export,

making up more than 40% of the nation's overall seafood export value throughout the

years

Additionally, Vietnam is the top producer of black tiger shrimp worldwide Shrimp has been contributing more and more to Vietnam's overall seafood export revenue in the last several years Shrimp exports made about 45% of all exports in 2021 as of October 31,

totaling 3.2 billion USD With a rise of 11.2% from 2021 to 2022, our nation's shrimp export revenue of 4.3 billion USD establishes a record In comparison to 2022, Vietnam's shrimp export turnover decreased by 13.31% in volume and 21.56% in value to 384.4

thousand tons, valued at 3,346 million tons USD in 2023

1.1.2 Shrimp production structure

The Ministry of Agriculture and Rural Development projects that by 2022, the nation's brackish water shrimp farming area will total 747 thousand hectares, of which 610 thousand hectares will be devoted to black tiger shrimp farming and 117,306 thousand to whiteleg shrimp farming A total of 1,080.6 million tons of farmed shrimp were

produced, an 8.5% increase over 2021 Of this amount, 271.4 thousand tons of black

tiger shrimp and 743.5 thousand tons of whiteleg shrimp were produced, with the

remaining portion being huge giant prawns and various shrimp In 2022, our nation's shrimp export revenue reached a record-breaking 4.3 billion USD, indicating an 11.2%

rise from 2021

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A, < ESE CUA VIET NAM 2022

Top 6 thị trường NK tôm của Việt Nam năm 2022 (triệu USD)

HIEP HOI CHE BIEN VA XUAT KHAU THUY SAN VIET NAM (VASEP)

Picture 1.1.2.1: Vietnam shrimp export in 2022

production of white-leg shrimp is 119.3 thousand tons, up 1.2%, and black tiger shrimp

is 119.3 thousand tons, up 1.2% 312.5 thousand tons of white leg, a 5.2% increase In the first half of 2023, our nation's shrimp export revenue totaled 1.56 billion USD, or

38% of the entire revenue generated by seafood exports from the nation

XK thủy san 6 tháng đầu năm 2023

Picture 1.1.2.2: Exporting seafood in early 2023

In the first half of 2023, shrimp export turnover will reach nearly 1.6 billion USD, 31% lower than the first half of 2022 Fish export turnover in June was still 26% lower than the same period last year, reaching about 156 million USD

Thị trường xuất khẩu tôm của Việt Nam năm 2025

Based on estimates using data from the General Department of Customs, Vietnam would export 384.4 thousand tons of shrimp in 2023, valued at 3.346 billion USD This

represents a decrease of 21.56% in value and 13.31% in volume over the previous year

by 2022, making up 18.23% of the nation's seafood exports in volume and 37.31% of its

value

The provinces along the Mekong Delta contain the majority of the farming regions The

five provinces that comprise the largest area for shrimp farming are Kien Giang, Bac

Lieu, Soc Trang, Ben Tre, and Ca Mau

At the moment, Vietnam exports shrimp to 100 nations, with the US, Europe, China, Korea, Japan, and Japan being the top 5 destinations Through persistent efforts, Vietnam has emerged as the second global provider of shrimp, with its export value representing 13-14% of the global shrimp export value Vietnam possesses numerous benefits for the growth of the shrimp sector, particularly in the Mekong Delta, which produces 95% of

the world's shrimp and serves as the hub for facilities that process shrimp

Các thị trường nhập khẩu tôm lớn nhất

BCPTPP EU Hàn Quốc Mỹ & Các thị trường khác

Picture 1.1.2.4: Vietnam's shrimp import market in 2022

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Vietnam is expected to produce about 4.9 million tons of aquaculture from January to

November 2023, an increase of 4.2% from the same time the previous year which had a 5.9% increase to 1,100,400 tons of shrimp During the first 11 months of 2023, there was

a 1.5% increase in shrimp production, with black tiger shrimp reaching 252,600 tons

Since 2014, the price of shrimp has been declining globally According to statistics, the average global shrimp price trend will fall by 9.1% from the start of 2023 to the end of October 2023, and by 26.3% from the start of 2022 to the end of October 2023

Dự báo xuất khấu tôm 2025 Cơ cấu thị trường

xuất khẩu tôm Việt Nam Tôm khác

418% © Trung Quéc @ Han Quéc

@ Nhat Ban @ Khac

Picture 1.1.2.5: Vietnam shrimp export market structure in 2023

Although exports in the third and fourth quarters showed encouraging signs, prices for

raw shrimp have been trending upward in recent months Vietnam's shrimp exports to the

US and China, the two largest markets, have both shown positive growth in the last two months as a result of the initial increase in demand from these two markets Vietnam also increases its shrimp imports into select markets, including Australia, Canada, and Japan

1.1.3 Quality standards

Since its establishment in the early 1990s, Vietnam's shrimp industry has expanded in

size, technical management, and capability in quality, traceability, and management, all

of which have contributed to these astounding accomplishments control the effects on the environment at every stage of the supply chain, from farms and processing facilities

to hatcheries, feed mills, and export via state-of-the-art cold storage facilities The

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increasing number of certification programs offered by international certification organizations for good aquaculture practices, such as Aquaculture Best Practices (BAP), Global Gap, and Aquaculture Stewardship Council (ASC), 1s the most trustworthy proof that shrimp farming in Vietnam is both sustainable and safe

The farms have to be constructed and run according to the following standards in order

to receive these certifications:

- Abide by the law

- Protect biodiversity and the environment

- Preserve water supplies

- Maintain the variety of species and their native populations

- Make responsible use of food and other resources

- Animal health (no needless use of pesticides and medicines)

- Social responsibility (no child labor, protecting the health and safety of employees, freedom of assembly, and community relations, for example)

In 2021, US nominal GDP reached 22.68 trillion USD, with a growth rate of 5.7% The

US economy tops the rankings in 2022 with an estimated nominal gross domestic

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product (GDP) of $25.5 trillion According to nominal figures, global GDP in 2023 is

forecast to grow by 5.3%, and if adjusted for inflation, this number 1s 2.8% Despite facing the difficulties of the Covid-19 epidemic, people's consumer demand still tends to increase

The United States is one of the world's biggest markets for shrimp imports; its territory spans numerous latitudes and it borders two sizable seas, the Atlantic Ocean to the west and the Pacific Ocean to the east One of the few nations in the world with the largest and most varied seafood reserves is the United States Notwithstanding the fact that the

US is a multicultural and multilevel nation with a thriving fishing sector, the country's seafood output will never be able to keep up with the rising demand variety in the kinds and caliber of seafood products purchased by consumers

1.2.2 Consumer trends and behaviors of Americans

US consumers choose frozen and processed shrimp items Shrimp dishes are becoming

more and more common on restaurant menus Shrimp is an easily digestible food that is

low in fat, high in protein, and packed with essential vitamins and minerals One of the

seafood varieties that Americans have grown to love in recent years 1s shrimp

There 1s a noticeable shift in the US shrimp business toward consumer convenience and

health standards Similar to this, customers are becoming more concerned with locating

the source of a product, guaranteeing user safety and health, and safeguarding the environment The composition of US imports and global prices are causing an increasingly irregular shift in American consumption patterns

When they get together with friends over the holidays, Americans frequently eat a lot of

shrimp Pre-Christmas week and Christmas week are the busiest times of year for

shrimp

The majority of seafood purchases made by Americans happen in stores and supermarkets because they have faith in the product's quality, cleanliness, and food

safety In the US market, seafood consumption channels are highly specialized and

closely related to one another Large supermarkets and individual retailers seldom

purchase directly from foreign exporters

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1.2.3 US law regulations for shrimp imports

Only international companies who have put in place a successful HACCP program are permitted to export fish to the US market, as per US Federal Code 21 CFR Through the analysis of potential risks and the application of control measures at crucial control points, this preventative quality management system guarantees food safety and quality Businesses must submit a HACCP plan and program to the US Food and Drug Administration (FDA) In order to be permitted to import fish products into the country FDA inspects and evaluates the gas The FDA will grant the business a license if it determines that it satisfies the conditions

In an effort to reduce the risks to food safety in the seafood business, the US Food and Drug Administration (FDA) has released an updated version of the Food Safety Manual 1.2.4 Barriers to trade and competition

Vietnam exports seafood to the US, but doing so presents a significant risk due to trade defense investigations, anti-dumping and anti-subsidy laws, and the implementation of several non-tariff protection measures

Furthermore, this import market consistently enforces stringent technical barriers in accordance with the US Food and Drug Administration's (FDA) standards, quality, and procedures, as well as the US Department of Agriculture's inspection regulations These regulations pertain particularly to the farming environment, antibiotic residues, labeling requirements, origin of goods, and copyright

However, there 1s still another difficulty: significant competitors like Ecuadorian and

Indian shrimp are putting intense pressure on Vietnamese shrimp in the US market

Particularly when the high cost of manufacturing makes Vietnamese shrimp less

competitive than those of foreign rivals

For instance, the production cost of 50-60/kg Vietnamese shrimp can reach 4.8—5

USD/kg, which is much more than Ecuador's 2.3-2.4 USD/kg and India's 33.8

USD/kg

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PART 2 TRADE BARRIERS 2.1 Trade barriers in the Exporting market

Vietnam, despite being a leading exporter of shrimp, still faces trade barriers when

exporting shrimp to the US market US requirements for food safety and food quarantine

measures demand strict adherence to standards, increasing production and export costs

for Vietnamese shrimp producers Additionally, trade protection measures also pose challenges in accessing this market

211 Tariff barriers

Vietnamese shrimp processing and exporting companies are facing a series of challenges

in accessing the US market Not only do they have to contend with declining shrimp prices in the global market and increased shrimp supply, but they also have to navigate the stringent policies of the United States aimed at protecting domestic production, particularly high anti-dumping tariffs

2.1.2 Non-tariff barriers

Non-tariff barriers are various restrictions, regulations, and standards imposed by the

importing country that can hinder or restrict trade Some non-tariff barriers that

Vietnam's shrimp exporters might face when exporting to the US include:

- Regulatory Requirements:

Food Safety Standards: The US has stringent regulations regarding food safety Vietnamese shrimp exporters must ensure that their products meet these standards to gain access to the US market

Phytosanitary Regulations: These regulations ensure that exported agricultural products are free from pests and diseases Compliance with phytosanitary requirements is essential

for exporting shrimp to the US

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Product Labeling and Packaging Requirements: The US has specific labeling and

packaging requirements for imported food products, including shrimp Vietnamese exporters must adhere to these regulations to avoid rejection or penalties

Documentation and Certification: Exporters may need to provide various documents and

certifications to prove the quality, safety, and origin of their shrimp products

- Technical Barriers:

Quality Standards: The US may have specific quality standards for imported shrimp,

including size, freshness, and appearance Vietnamese exporters must meet these standards to access the US market

Environmental Regulations: Compliance with environmental regulations, such as

sustainable fishing practices, may be required for exporting shrimp to the US

Certification and Inspection Requirements: Shrimp exports may need to undergo Inspection and certification processes to ensure compliance with US regulations

- Administrative Barriers:

Customs Procedures: Exporters must navigate customs procedures, including

documentation, inspections, and clearance processes, which can be time-consuming and complex

Import Quotas: The US may impose import quotas on certain products, including

shrimp, limiting the quantity that can be imported from Vietnam

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2.2 Trade barriers in the Importing market

XK THUY SAN SAN MY, THEO SAN PHAM CHINH (TRIEU USD)

= 2018 «2019 = 2020 2021 = 2022

8

~ Cá khá mCua ghe

Diagram 2.2 Vietnam Seafood export structure over the years

Source: Mekong ASEAN

Tariff Barriers are a form of consumer incentives that hinder international trade by establishing taxes that apply to goods or services imported from another country The tarifi position is imposed to increase the price of imported goods, making them more expensive than domestically produced goods This may cause consumers or businesses to pay more when purchasing goods from foreign sources compared to domestically produced goods

2.2.1 Tariff barriers

Import Tax, also known as import tax, is a fee or tax imposed on goods imported from one country into another The tax 1s used to raise revenue for the importing country or to protect domestic production and industry by increasing the price of foreign goods Import tariffs are usually applied as a percentage of the value of the goods or per unit of goods

For the shrimp industry, Vietnamese warm water shrimp has been subject to anti-

dumping tax on the US since January 2005 with tax rates ranging from 4.30% to 25.76%

and after the recent 3rd final review, the US still continue to impose taxes

2.2.2 Non-tariff barriers

Technical barriers to trade:

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Technical Barriers to Trade (TBT) in international trade denote the technical standards and regulations imposed by a country on imported goods, along with the procedures utilized to verify the compliance of those imported goods with the said standards and technical regulations, aiming to enhance quality and safety standards

Sanitary and Phytosanitary:

Sanitary and Phytosanitary Measures (SPS measures), as defined in the WTO, encompass all obligatory regulations, criteria, and demands that impact global trade, with the aim of safeguarding human and animal life as well as plant health These measures are intended to uphold food safety standards and prevent the spread of diseases

originating from animals and plants

The form of SPS measures can be very diverse for example, it can be quality requirements, packaging requirements, packaging procedures, means and methods of

transporting animals and plants, quarantine, etc.)

balance the need for free and fair trade with the need to protect domestic industries

For instance, on November 21, 2023, the U.S Department of Commerce (DOC) published a notice initiating a countervailing duty investigation on warmwater shrimp imports from several countries, including Vietnam Futhermore, The United States officially initiated an anti-dumping investigation on warm water shrimp products from Vietnam and a number of other countries since 2004

HACCP certification:

HACCP stands for "Hazard Analysis and Critical Control Points" This is an important

food safety management system widely applied in the food industry and especially in seafood production

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