Vietnam's largest pangasius exporter enjoys benefit of trade war

Rising trade war between the US and China in the recent time is seen to be opportunities for other countries which have chances of exporting products to two large and potential markets.

It is also an opportunity for Vietnam to promote the export of pangasius to both markets, in addition to United States Department of Agriculture (USDA)'s proposal of recognizing Vietnam is eligible for export of catfish to the US.

Vinh Hoan, Vietnam's largest pangasius exporter, currently accounts for 35 per cent of total pangasius export volume to the US and 40 per cent of export turnover. It is also a leading company in exporting Vietnamese pangasius, representing 15 per cent of market share in the firts eight months of 2018.

By the end of 2018, Vinh Hoan's factories excluding Van Duc Tien Giang have a maximum capacity of 750 tons of raw fish per day. The company has not been subject to taxes on exports to the United States for many years after meeting the USDA's strict food safety regulations.

On last September 13, the US Department of Commerce (DOC) announced preliminary results of 14th administrative review period (POR 14) on the anti-dumping duty of Vietnam catfish for the period from August 1, 2016 to 31 July 7, 2017. The tax rate applied to Vinh Hoan was not considered in this period so the company continued to enjoy the tax rate of zero per cent.

According to Ho Chi Minh City Securities Corporation (HSC), Vinh Hoan's prospects will be seen more clearly when Vietnam is officially listed as a qualified exporter of catfish to the US.

USDA Food Safety and Inspection Service currently announced the completion of field inspection in Vietnam, China and Thailand. It is proposing regulatory adjustments on catfish inspection and is going to recognize that three countries are eligible for export of catfish and catfish products to the US.

Vinh Hoan said that the approval of this draft does not impact much on the export volume and catfish export to the US is still stable. However, according to the securities companies, this is still very positive information for catfish - exporting companies in Vietnam.

HSC forecasts that export volume of Vinh Hoan can reach nearly 81,000 tons this year, up 4.8 per cent. The company's revenue in 2018 could reach $413 million, up 6.7 per cent year over year and profit after tax is projected to reach nearly $37 million, increasing 6.5 per cent.

Since the US - China trade tension, the stock prices of Vietnamese seafood companies have increased steadily. Vinh Hoan stocks even set the highest level ever on September 25th at VND96,000 ($4.1) per share.