Big buyers like Saudi Arabia and the US stopped importing from the sector last year.

Fisheries sector forced to restructure as declining demand decimates earnings

MYANMAR
Friday, March 15, 2019, 20:40 (GMT + 9)

Myanmar fisheries and marine product exports have been declining over the past year after big buyers like Saudi Arabia and the US stopped importing from the sector last year. Meanwhile, demand trends from Myanmar’s other major trade partners such as Bangladesh are evolving, which has forced the industry to explore new products and strategies.

Myanmar exports most of its wild fish and marine products to Thailand and China. Value-added marine products are exported to Japan and the US, while farmed carp and catfish are sold to Bangladesh, India and the UK.

Since April 2018, Saudi Arabia, one of the largest importers of Myanmar fish, suspended imports of rohu fish from Myanmar after bacteria was found on the same fish species imported from Vietnam. Despite clarifications from Myanmar officials that Myanmar-bred rohu did not contain any bacteria, a blanket ban was imposed on imports from Vietnam, Myanmar, Bangladesh and India. The ban has yet to be lifted.

The US, too, has stopped buying marine produce from Myanmar since the end of 2017, as the country does not deploy turtle excluder devices (TEDs) in its fishing nets. TEDs are a specialised device that allows a captured sea turtle to escape when caught in a fisherman’s net. 

“The bans from major buyers had caused significant disruptions and financial losses both in terms of export earnings for the country and the local fisheries industry,” said U Win Kyaing, secretary of the Myanmar Fisheries Federation. For example, Myanmar has lost out on 20,000 tonnes worth of marine product exports to Saudi Arabia. Prior to its ban, the US had also been the largest buyer of Myanmar shrimp.

►Carp farmer feeding the fish

Not ready

Myanmar is currently negotiating with Saudi Arabia to lift its ban on fishery imports from the region. Earlier this year, Saudi Arabia agreed to send a delegate from its Food and Drug Authority to check on cold storage facilities and fish farms in Myanmar.

Yet, some fish farms may not be ready for scrutiny by Saudi inspectors, industry insiders said. “Most of the marine product factories which export to Saudi Arabia are in a position to be checked by the Saudis. However, some fish farms in Ayeyarwady Region have chicken and pig farms near or above the fish breeding ponds and they would fail the inspections, said U Myo Nyunt, secretary of Myanmar Fishery Products Processors and Exporters Association.

He said the practice of having chicken coops above fish breeding ponds, which was a popular method in the past, is no longer acceptable internationally and that if Saudi Arabia is invited to check without first changing this system, not only will it not lift the ban, other markets might do so as well. 

The Myanmar Fishery Federation has already asked the Ministry of Agriculture, Livestock and Irrigation to remove this system. 

Locals, though, still buy fish bred under such conditions. “Carps are still being bred in water polluted with droppings of chickens and pigs. But if people keep buying these fishes, the farmers won’t change their habits. If there is no demand, then they will change,” U Myo Nyunt said.

Most fish farms in Myanmar are located within 50 kilometers of the capital Yangon, and are built on rice paddy lands (Photo: ussec.org/)

Food safety concerns

Besides the major buyers like Saudi Arabia and the US, Myanmar’s fish and marine products can be found in Canada, Japan, Korea, India, China, Taiwan, Hong Kong, Bangladesh and ASEAN countries like Thailand, Malaysia, Singapore and Vietnam. They are also sold in the Middle East and Europe. As such, Myanmar must adhere to international food safety standards in order to preserve its reputation as a major exporter.

“All these countries have high standards for safety and quality of food products. If demand from one or all of these countries is affected, it will have an impact on the entire supply chain. The industry could collapse and we are worried about it,” U Myo Nyunt said.

The industry needs to follow the procedures for food safety set by the Department of Fisheries across the entire supply chain. Currently, there are still traders who do not follow the procedure for ensuring their products are fit for export and one mistake could topple demand, said U Myo Nyunt.

Canada and Korea have come and inspected Myanmar fishery products. The EU has come as well and as the results have so far been good, fishery exports to the EU market are stable for now. “There are currently no problems from the EU but the threat of them suspending exports is real, if we do not meet the standards. Already we have lost two major markets. We cannot afford to lose another,” he said.

Changing demand trends

That isn’t the last of the sector’s problems. Demand from Bangladesh, the biggest buyer of Myanmar-bred carp, is also declining as India ramps up its fish farms and exports. At the same, the price of fish feed in Myanmar is on the rise, leaving little profits for breeders and fishermen, said U Hnin Oo, vice chair of the Myanmar Fishery Products Processors and Exporters Association.

What’s more, Bangladesh only imports big carps and as it takes around two years for the fih to grow, disruptions to demand have posed challenges for local fisheries. “Ideally, traders here prefer an eight month turnover for optimal operations. With the two year lead time needed to sell to Bangladesh, if demand from the country declines, local breeders and fishermen will have problems selling to other markets,” U Hnin Oo said.

Meanwhile, Myanmar is shifting away from rearing carp to breeding catfish instead. “While carp demand is falling, there is market demand for catfish from the US and China, so under our new export strategy, catfish breeding farms will be started up and expanded in the Ayeyarwady Region,” said U Hnin Oo.

“China is a country with a large population, and its people eat catfish. Efforts will be made to enter the Chinese market. The US and Philippine also have their markets for catfish, but we would need to take more measures to enter the EU market such as investments to renovate existing farm facilities. But it won’t be easy to secure such investments now,” he said.

Author: Chan Mya Htwe/mmtimes.com

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