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Catfish breeders get contract law   2008-09-15 - VNA

Tra catfish processors will have to breed their own supply of catfish or buy fish from breeders under an official supply contract signed in advance, according to Ngo Phuoc Hau, Vice President of Vietnam Association of Seafood Exporters and Processors (VASEP).

Since the fourth quarter of this year, processors will not be allowed to buy catfish from non-established catfish breeders, in order to reduce the financial and product quality risks for both sides, Hau said.

Due to the big profits made by tra catfish breeding last year, many farmers flocked into the business this year, which has caused a redundancy and devaluation of tra catfish, Hau explained.

Forty percent of fish breeders are quitting the business due to losses. Additionally, many new processing factories jumped into the sector at the same time as banks began shutting off credit flows to the industry. Since the beginning of September, the dreadful combination has led to a tra catfish shortage to processors.

According to the new model, banks will not offer loans for breeders but pour capital into the raising of catfish. Processors then will supply fish breeders with fish breed and feed. The catfish farmers will raise the catfish for the processors and then under contract, sell the supply of fish to them.

Breeding practices must follow the official regulations on raising catfish set by Ministry of Agriculture and Rural Development.

The purpose of the new breeding model is to skim off inefficiency among fish breeders and processors and prevent future scarcity of tra catfish, thus stabilizing the supply of catfish for next year’s export and maintaining the breeding industry in the long run, Hau said.

The 2009 target for the export value of Vietnam ’s tra catfish has been set at 1.5 billion USD, an increase of 25 percent over this year’s target, which will require 1.2 million tonne of input materials to produce 600,000 tonne of tra filet.

At present, catfish businesses can supply 70 percent of the catfish input material needed for next year’s production, which they themselves have raised, approximately 840,000 tonne, according to VASEP.

They will fulfill the remaining 30 percent by signing contracts with seafood farmers, Hau said.

Authorities of most provinces in the Mekong River Delta have pledged to apply the new breeding model with VASEP.

In 2009, contract-less catfish breeders will find it difficult to find consumers for their fish, Hau said.

VASEP also encourages businesses to periodically provide accurate figures on the available catfish volumes raised by catfish breeders and farmers so that VASEP can better coordinate the regulation of breeding activities with local authorities.

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