VIM - Because I.D.I International Development & Investment Corporation (with the stock symbol of IDI) has mastered a closed production process from seed, pond, aqua feed, through a processing factory with modern technology, skilled staff, and a quality management system to ensure food safety and hygiene, the Corporation is regarded capable of large-scale export to strict markets.
The company is promoting procedures to export pangasius to the US market, according to Mr. Le Van Chung, General Director of I.D.I International Development & Investment Corporation. This was formerly a major market for the Corporation.
Workers are working at a pangasius processing factory for export
Mr. Chung stated that IDI used to export to the United States with a turnover of hundreds of millions of dollars per year, and that the Corporation benefited from a tax rate of 0% at the time. However, the tax rate imposed on the Corporation as a result of anti-dumping litigation is unnecessarily high, thus IDI is currently working with lawyers to re-establish this export market, which will be the Corporation's emphasis in the next years.
According to the Ministry of Agriculture and Rural Development, pangasius export turnover in 2021 is expected to be between 2 and 2.2 billion USD, confirming its position as a key seafood export product. Vietnamese pangasius products are currently available in approximately 125 markets, the most important of which being China, the United States, the European Union, and ASEAN. The United States has a market share of nearly 20%, China has a market share of 32%, and the European Union has a market share of 15%.
Food source is strictly controlled
In the United States, the service sector (hospitality) accounts for 70% of consumption channels, while retail accounts for the remaining 30%. According to Worldfishcenter data, the service channel has fully recovered to pre-pandemic levels. According to BSC Securities, Vinh Hoan is currently the leading pangasius exporter in Vietnam, with a considerable market share in the United States. The Chinese and Thai markets account for roughly half of Nam Viet's market share. With IDI, the Chinese market accounts for 44% of the market share, followed by South American markets such as Mexico and Brazil.
The price of Vietnamese pangasius for export is steadily rising. According to the Ministry of Agriculture and Rural Development, businesses exporting pangasius fillets to the United States reached a price of around 3.5 USD/kg in 2020, it will increase to 4 - 4.5 USD/kg in 2021; pangasius export prices in Asia and South America are also quite good, ranging from 3.5 to 4 USD/kg, the highest price in decades. Mr. Le Van Chung claims that IDI's export contracts to South America are now priced at 3.9-3.95 USD/kg. Because of the favorable market, the Corporation is able to select orders with better rates and payment terms than before.
Since March 2016, when the Farm Bill went into force, Vietnamese pangasius is subject to product and farming area quality control from FSIS (The Food Safety and Inspection Service of the US Department of Agriculture). As a result of this requirement, businesses must guarantee that they have good seed and standard farming areas in order to assure raw material traceability.
Since 2008, IDI has applied a controlled process to organize farming areas. The Corporation's own fish farming and associated farming areas are currently up to 400 hectares while complying with Global GAP, ASC, and BAP standards. Farmers are provided with seed, animal feed, biological products and purchased output products. With the formation of such large-scale associated farming areas, IDI is fully active in supplying raw materials to frozen factories, creating products of competitive quality.
By Lap Nguyen
