HCM CITY – Seafood producers and exporters in Việt Nam are being urged to overhaul their approach to the domestic market, moving away from viewing it as merely a fallback for surplus exports and instead embracing it as a fundamental pillar of long-term business strategy.

The message was reinforced at a conference held in HCM City on August 1 to promote stronger connections between seafood manufacturers and domestic distributors, as well as to foster investment, joint ventures and trade promotion focused on meeting local consumption demand.

In the current economic context, where export markets remain volatile, the domestic market is being repositioned as a vital platform not only to support short-term revenue but also to secure long-term resilience for the industry.

Domestic seafood consumption currently accounts for approximately 60 to 70 per cent of total demand, with key products such as shrimp, basa fish, squid, and ocean-caught fish dominating.

Nevertheless, imported seafood still maintains a significant presence, representing around 30 to 40 per cent of total consumption. Industry leaders agree that there is considerable room for growth if domestic producers can improve competitiveness and better align their distribution networks with consumer needs.

According to Huỳnh Minh Tường, deputy hairman of VASEP, the domestic market should be seen as a strategic complement to exports, with the potential to help businesses optimise operational costs and maximise the utilisation of raw materials.

He emphasised that building a robust domestic presence is no longer optional, especially considering shifting global trade patterns.

Several producers and distributors attending the conference shared concerns over existing challenges in developing the local market.

The high cost of logistics, transport, and cold storage has significantly reduced the price competitiveness of domestic seafood, especially in comparison to imported alternatives.

Additionally, the limited availability of specialised wholesale markets and an uneven distribution infrastructure across regions have created major barriers to accessing consumer markets nationwide.

Retailers also voiced concerns about inconsistent supply and the lack of transparent traceability systems, which make it difficult to maintain quality assurance in modern retail channels.

For many supermarket chains, the unpredictability of deliveries and unclear origin documentation limit their ability to commit shelf space to domestic seafood.

Processors further noted that Vietnamese consumers remain hesitant to purchase ready-to-eat or processed seafood products, often due to concerns about food safety standards and manufacturing practices.

Trần Hữu Linh, Director General of the Domestic Market Development and Management Authority, highlighted that local demand must no longer be seen as a temporary shelter during export downturns.

Instead, it should be positioned as a cornerstone of sustainable development for the seafood industry.

He argued that enterprises must build comprehensive business models specifically tailored to domestic consumption—from aquaculture and harvesting to processing, distribution, and post-market supervision.

He called for enhanced investment in consumer research and market segmentation to better understand evolving tastes and the increasingly diverse preferences of a growing middle class.

Product innovation and diversification, he said, will be critical to attracting this emerging consumer base and creating a stronger emotional connection with local buyers.

One of the most pressing requirements, according to Linh, is ensuring full transparency along the entire supply chain.

He noted that traceability and product verification are no longer simply regulatory compliance issues, but key determinants of consumer trust and loyalty.

The Ministry of Industry and Trade is now accelerating the implementation of traceability systems to certify seafood origin and safety, from farm to fork.

The logistics infrastructure supporting domestic seafood distribution is also in urgent need of improvement.

Linh underscored that modernising supply chains and building integrated distribution systems will reduce intermediate costs, improve price stability, and strengthen the overall competitiveness of local seafood products.

He added that such investment would help unlock greater efficiency between production zones and consumption markets, especially in remote or underserved areas.

He concluded by stressing that Vietnamese businesses must assume greater responsibility for nurturing the domestic market.

Developing a vibrant and resilient local consumption base is not only about boosting immediate sales but also about demonstrating the integrity and strength of Vietnamese brands on home soil.

In a tangible step towards this goal, sixteen major retail chains and seafood enterprises signed a memorandum of understanding during the conference.

The agreement reflects a shared commitment to expanding the presence of domestic seafood in supermarket shelves and local dining tables, and to ensuring Vietnamese consumers have greater access to high-quality, locally-sourced products.

The Ministry of Industry and Trade affirmed its continued support for initiatives aimed at developing the domestic market, including improved policy frameworks, infrastructure investment, and communication campaigns to raise consumer awareness.

Strengthening domestic seafood consumption, it said, is not merely a commercial priority but a national mission that requires collaboration across all sectors of the economy.

According to estimates from the Ministry, investing in local distribution and traceability systems could reduce overall seafood logistics costs by up to 20 per cent.

Many businesses are also exploring digital transformation and e-commerce platforms to bridge the gap between producers and consumers more effectively.

However, these shifts require significant capital and policy backing.

As of now, proposed infrastructure support packages for seafood logistics hubs are valued at over VNĐ 3 trillion (approximately US$126 million), underscoring the scale of commitment needed.

As Việt Nam continues to build a more self-reliant economy, the role of the domestic seafood market will only grow in significance.

Businesses that embrace this shift early stand to not only enhance resilience but also carve out a competitive edge in a fast-changing global environment. – VNS