After constant disruption due to the Russia-Ukraine conflict, seafood exports to the Russian market have shown many positive signals.

 

As per statistics from the Vietnam Association of Seafood Exporters and Producers (VASEP), by the end of August 2022, Vietnam's seafood exports to Russia reached over $94 million, down 20%, due to the Russia-Ukraine conflict since the end of February 2022, causing Vietnam's seafood exports to stall in March and April.

 

However, seafood exports to Russia are revealing many positive signs.

 

Some exporters said that the Russia-Ukraine tension caused some orders to return, and tuna exports to both countries had to be halted due to banking risks. Supply chains for production and import and export were broken. As a matter of fact, businesses are having to monitor the tracking number to handle inventory or find ways to export to other markets.

 

Therefore, seafood exports to Russia in March and April decreased by 86% and 46%, respectively, because of traffic congestion and difficult trade payments. However, from May, seafood exports to Russia gradually recovered and from July, exports to this market reversed with an increase of 36% and even a sharp rise to 98% in August.

 

According to the analysis of Ms. Le Hang, Deputy Director of VASEP.PRO, catfish is still the most exported item, accounting for 22% of seafood exports to the Russian market with a value of nearly US$21 million in the first eight months of this year, 12% lower than the same period last year. In which, frozen pangasius fillets accounted for about 75%.

 

While the export of most seafood products to Russia witnessed a decline which is mainly due to the interruption in the first stage of the Russia-Ukraine war, the export of yellowfin, tuna and anchovies to this market still maintained positive growth. In which, tuna exports accounted for 17%, increased by 97% to nearly US$16 million, yellowstripe scad increased by 6% to US$14.6 million, accounting for 15%, and anchovies increased by 27% to US$4.6 million.

 

Exports of white leg shrimp, fish cakes and surimi all recorded a sharp plunge of more than 50% over the same period last year. In which, whiteleg shrimp exports reached over US$16 million, accounting for 17%, surimi fish cake exports reached over US$12 million, accounting for 13%.

 

In the first 8 months of this year, 39 Vietnamese enterprises participated in exporting seafood to Russia. In which, Nam Viet Joint Stock Company accounted for the largest proportion of 13% with the main product being pangasius. Followed by Saigon Food Import-Export Joint Stock Company (12%), Hai Vuong Company Limited (12%), Anh Long Food One Member Limited Liability Company (8%) and Minh Phu Seafood Group Joint Stock Company (7%).

 

In 2022, six more enterprises are allowed to export seafood to Russia which brought the qualified ones up to 54 enterprises. However, Vietnam's seafood market shares in total imports from Russia grew slowly due to strict non-tariff barriers (technical) introduced by Russia.

 

On the other hand, the number of seafood enterprises licensed to export to this market is still limited due to the complicated registration procedures on the Russian side and the lengthy approval time. Currently, there are still many enterprises applying for registration of seafood export to Russia, which are still waiting for approval.

 

According to Mr. Duong Hoang Minh, Vietnam's Trade Counselor in Russia, as soon as the Russia-Ukraine war started, the Russian banking system was blocked, the ruble was devalued, but Russia took a quick reaction in order to stabilize the foreign currency source.

 

Despite economic sanctions from many G7 countries, goods in the Russian market have maintained stabilization because Russia still has many other partners, and Russia's exports to the world market still soared. In 2021, Russia's trade surplus reached about US$70 billion and this year Russia's trade surplus is forecast to be even larger. The payment problem when exporting to Russia is no longer a problem and the market space is still large, which will be an opportunity for Vietnamese enterprises to restore exports to this market.

 

According to Mr. Minh, transporting goods from Vietnam to Russia has been much more facilitated. Currently, the Russian shipping group has operated a direct transport route from Ho Chi Minh City - Hai Phong - Vladivostok and some shipping lines running new routes which enable to shorten the transportation time. In addition, there is a rail transport system to support trade with Russia.

 

Thanks to such positive signals, a representative of VASEP said that seafood exports to the Russian market will bounce back in the last months of this year. It is forecasted that in 2022, Vietnam's seafood exports to Russia will record a growth of 16%, reaching over US$190 million.

 

Source: Customs News