- 2024-02-06T00:00:00
- Sector Reports
- Vietnam’s pangasius export value inched up 2% YoY and 1% QoQ in Q4 2023. Based on our estimate from AgroMonitor’s data, Vietnam’s pangasius export value achieved USD485mn in Q4 2023 which was mainly due to a 5% QoQ increase in volume. That was offset by the 4% QoQ decrease in average selling prices (ASP) across pangasius exporters, in which the key player VHC’s ASP plunged 28% YoY and 12% QoQ in Q4 2023.
- Export volume to the US increased slightly QoQ while sales to China and Europe were subdued in Q4 2023. In Q4 2023, pangasius export volume to China (Vietnam’s largest pangasius importer) declined 11% QoQ, which was mainly because of (1) a softening from the Chinese festive season in Q3 and (2) fierce competition with other whitefish filets in this country’s fishery market landscape. That also suggests Chinese consumers remained price conscious when dining out, further proven by the remaining low level of Chinese consumer confidence in Q4 2023. As such, we see narrow growth headroom for pangasius prices in China’s market in 2024. Meanwhile, sales volume to the European market slightly increased 2% QoQ while that in the US market grew 6% QoQ, which we mainly attribute to stronger consumer confidence in the holiday season. According to fish processor/exporter VHC, US buyers have been conservative regarding high cold chain fees for frozen pangasius filet preservation amid weak consumption, and the company expects higher volume orders in H2 2024 when consumer confidence recovers and food prices stabilize. Moreover, we believe that the US and the EU tightening their Russian and Russian-origin fish and seafood ban may potentially have a positive spillover effect on Vietnamese fishery products, including pangasius.
- Supplies remained tight in Q4 2023 because of weak orders; commodity prices softened and better weather forecasts to alleviate farming costs in 2024. The yield from raw pangasius farming in Mekong Delta declined 15% YoY in Q4 2023, according to AgroMonitor. Pangasius farmers have delayed new farming cycles in H2 2023 due to (1) selling prices falling below the break-even level and (2) high farming costs. We expect the tight supply situation to continue in Q1 2024. However, pangasius output should improve in Q2 2024 going forward, as the impact of El Niño is expected to diminish in March 2024 before potentially returning to neutral conditions from Q2 2024, according to IRICS’s forecasts. Together with that, soybean meal (key fish meal material) prices decreased 23% in November-December 2023 and are forecasted to decrease 10% YoY in 2024 by the USDA, which we expect to alleviate farming costs in 2024.
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