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Puffer export: the high hope dashed

The project on processing and exporting puffer, in which Vietnamese farmers and enterprises put high hopes, may fail completely since the foreign partner suddenly stopped importing.

Vietnamese puffer exporters are complaining that the unexpected import interruption has led to the loss of billions dong as tens thousands of puffers have not been exported.

Nearly two years ago, Vietnamese farmers and enterprises were bustling with joy when the Government allowed them to carry out the project on processing and exporting puffer fish. The exports were hoped to bring more jobs and more money to farmers and enterprises.

In a cautious step, the Government decided that the project would be carried out on a trial basis in the years from 2010 to 2012 in five provinces, namely Quang Ninh, Nghe An, Phu Yen, Khanh Hoa and Kien Giang. The estimated investment capital was $2.7-3 million. The program had ambitious goals: by 2012, Vietnam would raise the volume of puffer fish products to 1000 ton and get the average export price of $5-10,000 per ton. 600-1000 jobs were to be created and the turnover of $10 million a year to be reached.

At the time when the project was discussed, six provinces registered to join the pilot program. Meanwhile, many companies from South Korea, Japan and China expressed their willingness to import Vietnam’s puffer fish. Some Chinese companies even declared that they would buy all kinds of puffer fish at the prices higher than that offered by other countries.

However, the Ministry of Agriculture and Rural Development asked the Government to assign the implementation of the project to the puffer fish processing companies which met the requirements in terma of the workforce, facilities, technical and financial capability, and have stable export markets.

As for 2010, Korea Poseidon Seafood (Poseidon) was accepted to be the importer of puffer fish from Vietnam.

However, year after the project began, Poseidon unexpectedly stopped importing puffer from Vietnam. The move of the South Korean importer has made the puffer processing in Vietnam stagnant and caused billions of dong of losses to Vietnamese enterprises.

Nguyen Huu Phuong, a senior executive of Mai Sao Company, of the puffer exporters, said that his company had signed a contract with Poseidon. Mai Sao had collected and processed more than 90 tons of puffers, and exported 22.7 tons until Poseidon suddenly announced the halting the import.

On November 27 and December 14, 2010, the South Korean send dispatches to Mai Sao, explaining that the consumption of imports has been slow, and the products cannot compete with those from Indonesia.

At the recent conference reviewing the implementation of the project on puffer export held recently in Kien Giang province, Kim Young Sik, General Director of Poseidon said that since the quality and the size of Vietnam’s puffer products did not meet the standards, the imported consignment of 22 tons of fish had been selling very slowly. Besides, Vietnam’s puffers have high content of toxin and they were inedible. He said that the company could purchase 100 tons of fish a month, provided that the products met the quality requirements.

Nguyen Ngoc Phuong, Deputy Director of the Kien Giang province’s Department of Agriculture and Rural Development, does not agree. She said that the explanation was not reasonable, because Korea Poseidon Seafood sent its own staff to Kien Giang province to supervise the production and processing.

The Ministry of Agriculture and Rural Development has been criticized for allowing company to import puffers from Vietnam. Analysts believe that the monopoly allows the South Korean company to control the prices.

In reply, the ministry’s Deputy Minister Luong Le Phuong said that puffer is a kind of toxic fish, therefore, it needs a very strict management mechanism. That explains why the ministry allowed to carry out the project on a small scale and choseonly importer.

According to Cao Huong Thien, Director of Mai Sao Company, the South Korean partner is purchasing puffer in Kien Giang at $1.4 per kilo, while the puffer fish from Thailand, India and China are priced at $3-5 per kilo. Currently, enterprises have stopped collecting puffer from farmers because they cannot export their products. As the result, farmers have to sell fish dirt cheap as the animal feed. He also stressed that if more foreign partners were allowed to purchase Vietnam’s puffer, enterprises would be able to sell fish at better prices.

Phuong said that if Poseidon Seafood did not buy the fish, the ministry would allow Mai Sao to sell all the inventory volume to other partners

From VietNamBusiness

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