BACKGROUND STUDY FOR GLOBAL VALUE CHAIN ANALYSIS FOR STRIPED CATFISH

BACKGROUND STUDY FOR
GLOBAL VALUE CHAIN ANALYSIS
FOR STRIPED CATFISH
Nguyen Minh Duc
Department of Fisheries Management and Development
Nong Lam University, Thuduc, Hochiminh City
Email:

Presentation at the FAO Workshop
University of Tokyo, Japan, 09-11 Dec, 2010
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Brief on Vietnam fishery export
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fishery product exports have increased considerably since
2000 to become a major income earner and one of
Vietnam’s major export commodities.
Aquatic exports earned over $1 billion in 2000, $ 2.2
billion in 2003 and $3.36 billion in 2006.
Catfish and shrimp are by far the largest share of aquatic
exports, accounting for over 22% and 44%, respectively, of
total export earnings in 2006.
Currently Vietnamese fishery products have reached more

than 120 countries and territories on five continents.
Japan and the United States are the two largest export
destinations, by country, while European Union nations, as
a group, had the largest share of exports by volume and the
second largest share by value in 2006.
Prepared by Nguyen Minh Duc 2010

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Vietnam's Primary Fishery Export Products in 2006
(value basis)

Prepared by Nguyen Minh Duc 2010

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Vietnam's Fishery Products Export Market, 2006
(value basis)

Prepared by Nguyen Minh Duc 2010

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Mekong Delta
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most dynamic aquaculture region of Vietnam
The Mekong delta has 641,350 ha of freshwater
area, which comprises of 67.2% total water surface
most diversified aquatic farming activities and
great potential for increasing aquaculture
production.
There are a few species, which have been
commercially produced in the Delta, such as
pangasiid catfishes and black tiger shrimp
(Penaeus monodon)

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Vietnamese stripped catfish is similar to US catfish

US catfish
- are Ictaluridae family,
• channel catfish (Ictalurus punctatus)
• blue catfish (Ictalurus furcatus)

farmed in closed ponds
in southern states

Vietnamese catfish
are Pangasius family basa (Pangasius bocourti) +
tra (Pangasianodon hypophthamus) +
farmed mostly in pens and deep ponds
along the Mekong River, southern
provinces

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Catfish production
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Catfish production reached 1,500,000 tons with only 6000
ha
Farm price of catfish was decreasing during 2005-2009,
around 15,000 – 17,000 Vietnam dong (~ $0.78-0.84) per kg
while the price of exported catfish fillets is 2.3 USD/kg.
12% of farmers get financial loss since 2008.

However, farm price is increasing in the last months of 2010
(~$1/kg) and also exported price ( $2.6/kg) due to lack of
harvested fish.
the farming and processing sectors of catfish industry has
created 800,000 jobs for farmers in Mekong Delta and many
more in inputs supplying sectors.

Prepared by Nguyen Minh Duc 2010

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Pond
culture

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Catfish processing
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The striped catfish is processed mostly in frozen fillets
form for exports.
The annual export value is 1.4 billion USD

fresh catfish is also exported but the fresh products
mostly for domestic use.
The processing sector including 280 enterprises.
Following quality standards and improved to meet
global standards on quality, food safety, and
environmental conservation.

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Rapid growth in catish industry

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More commercial scales
Total

4,696

7,558

5,459

1
0.9

Proportion of farms

0.8
0.7

>0.5 ha
7.2
21.4

17.7

> 2.0 ha
17.3

1.0 - 2.0 ha
0.5 – 1 ha

0.6
0.5

20.9

23.5

28

≤0.5 ha

0.4

0.2 to 0.3 ha
0.1 – 0.2 ha

0.3
0.2

0.3 – 0.5 ha

24.9

17.3

38.4

0.1

16.8

16.7

2007

2008

0.05 – 0.1 ha

<0.1 ha

< 0.05 ha

0
2006

Year
Prepared by Nguyen Minh Duc 2010

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Supply chain in catfish industry

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Market structure in 2008
Inputs
supplier

Production
Input
suppliers

-Seed
-Food
-Medical
chemicals

Farmers

Collectors

8.9%

Catfis
h
farmer
s

Processors

Traders

2.2%

Brokers

Consumers

Wholesalers
6.7%

Retailers

Local
consumers

4.5%

1.9%
91.1%

Processors

91.4%

Export markets

Associations
Provincial extension system
Research institutions/Universities

Trade promotion
Centers

VASEP
NAFIQUAD
Banks

Source: Loc, 2009
Prepared by Nguyen Minh Duc 2010

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Market structure in 2009
Inputs
supplier
Production

Input
suppliers

-Seed
-Food
-Medical

Collectors/

Farmers

Brokers

13,8%

Catfis
h
farmer
s

Processors

Brokers

Traders

4,6%

Consumers

Wholesalers

Retailers

4,6%

9,2%

Local
consumers

9,2%
8,6%
86,2%

Processors

chemicals

77,6%

Export markets

Associations

Provincial extension system
Research institutions/Universities

Trade promotion Centers

VASEP
NAFIQUAD
Banks

Source: N.Khiem and Bush, 2010
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Vietnamese catfish industry globalization
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Vietnamese catfish industry has considerably developed
since the country joined into globalization and adopted free
trade principles
employed almost a million Vietnamese people
Vietnamese producers successfully created low-cost
breeding techniques of catfish in 1998 and developed a
catfish breeding industry involving 15,000 families
VN catfish farmers have opted to buy imported pellet feed
and also adopted advanced feeding technologies to improve
fish meat quality, meeting the quality and taste requirements

of US consumers.
VN catfish processors have learned catfish fillet techniques
from an Australian importer and used processing equipments
purchased from the US for their production, following the
quality control protocols of HACCP, SQF and Global GAP
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Increase in catfish exports


Prior to 1998, the time Vietnam join into APEC,
export volume of tra and basa to US market was
200 metric tons



In 2002, after the US and Vietnam signed the
Bilateral Trade Agreement (BTA), the export
volume increased to more than 8.000 metric tons

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Increase in catfish exports
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Although exporting catfish even before 1995, the
tremendous spurt in exports to US came in 1999
when raw seafood tariffs dropped to zero
reached a volume of 18.3 million kilograms of
catfish to the US, which is valued at $55.1 million
in 2002 after the bilateral trade agreement between
US and Vietnam was signed in December 2001.

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Involving into trade protection
policy from the US
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US labeling
US antidumping

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Price effect of the US barriers

Labeling law


US fillets production increased but its price still decreased,
in contrast to Vietnamese products
Unit

1999

2000 2001

2002 2003 2004 2005

Vietnam fillets price

$/lb.

2.04

1.52

1.26

1.29

1.21

1.15

0.93

US fillets price

$/lb.

2.76

2.83

2.61

2.39

2.41

2.62

2.67

Antidumping tariffs

$/lb.

--

--

--

--

0.64

0.61

0.49

US farm price

$/lb.

74

75

65

57

58

70

72

US imports from VN

Mil. Lbs

2

7

17

10

4

7

17

US fillets production

Mil. lbs.

120

120

115

131

125

122

124

US farm production

Mil. lbs.

597

594

597

631

661

630

601

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Trade effects

Antidumping measures
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Since1980, US producers have been continuously

seeking a trade protection



Byrd Amendment 2000 (cancelled since 2008)
allowed the petitioners in AD suits get
disbursement from tariff revenue



From 1980 to 2004, the US investigated 1092
antidumping cases of which 461 lead to a tariff

Prepared by Nguyen Minh Duc 2010

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Effect of the US catfish antidumping with linear regression
for an equation system

PRELIM
FINAL

US
price

VN
price

US
US farm
demand
price

0.002
(0.657)

-0.004
(-0.106)

0.012
(0.582)

0.004
(0.643)

0.006

-0.029

0.031

0.006

(2.531)

(-0.963)

(1.824)

(1.167)

* Absolute value of t- ratio is in parenthesis
:

More info at Duc, NM (2007)
Prepared by Nguyen Minh Duc 2010

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Effects of AD measures on fish market shares
in US market

Antidumpin
g
measures

Imported
Salmon

Imported
Tilapia

Imported
Catfish

US Domestic
Catfish

0.036
(2.37)

0.053
(3.83)

-0.038
(3.82)

-0.032
(2.93)

* Absolute value of t- ratio is in parenthesis
:

More info at: Hong, TTK, Duc, NM and H. Kinnucan (2008)

Prepared by Nguyen Minh Duc 2010

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Other non-tariff barriers from the US
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Oct 2005, “Sales Ban” order in Alabama, Mississippi,
Georgia and Louisiana
May 2008, US Farm Bill 2008, catfish quality must be

strictly controlled before imported to the US

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Diversification of export market
Vietnamese Catfish Exports (Unit: metric ton)

APEC join

US-VN BTA
signed

Total exports

EU

Japan

US

1997

425

54

0

55

1998

2263

188

22

261

1999

1715

192

91

903

2000

3,689

19

28

3,191

2001

10,955

140

9

7,765

2002

27,980

2,979

632

4,361

33,304

7,388

464

1,929

2004

82,962

23,637

932

3,010

2005

140,707

55,172

579

8,623

US antidumping
measures issued 2003

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