A move to split off China-dependent processing: Kyokuyo builds its first production base in Vietnam

The major Japanese seafood company Kyokuyo has launched its group's first production base in Vietnam, in Long An province in the south. This plant, which puts processed crab products and fish fillets at its core, is part of an effort to spread processing functions that had concentrated in China across Southeast Asia, and many of the products made there come back to Japan. In other words, 'where it was made' for the processed fish lining Japanese supermarkets and foodservice chains is quietly being rewritten. For Japanese buyers sourcing raw materials and processed goods, this becomes prime material for reading the change in the sourcing map.

Kyokuyo's first processing base in Vietnam

Through its Vietnamese local subsidiary Kyokuyo Vina Foods, Kyokuyo built a processing plant in the Duc Hoa 1 Industrial Park in Duc Hoa district, Long An province. It produces fish fillets, simmered fish, grilled fish and processed crab products, with investment of about JPY 2.1 billion. It expects employees on the scale of 700 as of 2025. This is the first time Kyokuyo has held its own production base in Vietnam, and many of the products are planned for export to Japan.

The plant was completed on November 8, 2024, and it was announced that, after a December 2024 trial run, full operation was planned from February 2025. Output is assumed to be raised to about 5,000 tonnes in the first year, 2025, and about 7,500 tonnes the following year, 2026. The amount itself does not stand out as capital investment for a major seafood company, but as a statement of intent to 'hold one's own base that can be entrusted with processing for Japan outside China,' its significance is weighty.

Why Vietnam, not China

Behind this is the structure in which Japanese seafood processing has long relied on China. From the balance of labor cost and processing skill, Japanese seafood companies built a flow of sending raw material to China to process and returning products to Japan. What made the fragility of that one-legged supply network clear to everyone was China's suspension of imports of Japanese seafood, triggered by the August 2023 release of treated water from the Fukushima Daiichi nuclear plant. If China's plants stop, the processed goods that should reach the Japanese table stop too. This experience is pushing the move to diversify processing locations.

That said, China's import suspension was partially lifted at the end of June 2025, and imports of seafood -- excluding from 10 prefectures such as Fukushima and Tokyo -- resumed conditionally. Even so, the reason the majors do not slacken their overseas-base building is that they want to avoid the very risk of depending on a single country for the supply network. The reason for choosing Vietnam is also clear: it is easy to secure processing labor, and the logistics network for Japan is also taking shape. Kyokuyo also launched a plant in Thailand in 2022 handling grilled fish, simmered fish, sushi toppings and frozen sushi, and this Long An plant is on the extension of the current of broadening processing receptacles in Southeast Asia.

Kyokuyo's overseas processing bases, seen in data

From a single pole in China to multiple bases including Thailand and Vietnam. Diversifying processing locations has now become behavior common to Japan's major seafood companies. Kyokuyo is one corner of the three seafood majors alongside Maruha Nichiro and Nissui, and the significance of that number-three newly establishing a base for Japan-facing processing in Vietnam is not small. It shows that not only the top company but the majors as a whole are moving to review processing locations.

Whereas Thailand has Southeast Asia and the West as its main exits, Vietnam's Long An plant puts Japan at its axis. Even for processing bases in the same Southeast Asia, the point to read is that they are designed with the target markets divided.

Read operation progress by separating plan and results

The plant began a trial run in December 2024 and had planned full operation from February 2025. More than a year and a half has passed since completion, and because Kyokuyo's business report also touches on the Vietnam plant's operation, production itself can be taken as having started up. However, whether it is running at the planned volume and profitability cannot be fully read from public information. When handling news of an entry, the 'planned value' at completion and the subsequent 'results' need to be taken separately. If you use it for a sourcing decision, it is surest to confirm the current production items and supply capacity directly with the local subsidiary or the manufacturer.

What is interesting about this plant is that it is designed not as a base to sell Vietnamese seafood but as a 'processing hub' supplying countries including Japan. It is an idea of separating from the raw material's production area and placing only the processing step in Vietnam. The trend of Vietnam growing its presence as a supply ground for Japan is, Vietnamese scallops become Japan's largest buyer: how a processing hub opens a new sourcing route as we saw there too, and Kyokuyo's entry shows that this 'turning into a processing hub' has entered a stage borne by the majors themselves.

Points for Japanese seafood buyers to grasp

From this matter, there are three points the buying side will want to read.

• The options for processing locations widen: Vietnam joins in earnest the processing receptacle that had leaned on China. Even for the same fillets and processed crab products, goods whose supply source shifts from China to Vietnam will increase going forward.
• The majors blaze the trail: When a major like Kyokuyo brings its own plant and quality control on-site, the surrounding logistics, inspection and human-resource foundations fall into place. The hurdle for small and medium buyers later sourcing Vietnamese processed goods also drops.
• Products made to Japanese standards emerge: Rather than local domestic sales, processed goods made from the start to Japanese standards and tastes increase. It means one more supplier whose specifications are easy to match.

Conversely, buyers handling goods that have depended on processing in China are pressed to re-examine their supply network. It is worth beginning now to consider how to position Vietnam as an alternative processing location. On the structure in which Japan and Vietnam have begun to circulate raw material and processing between each other, The era of Japan merely buying is ending; Japan and Vietnam enter a stage of circulating raw material to each other in seafood is detailed.

Diversifying processing locations becomes an industry-wide trend

Kyokuyo's Long An plant should not be seen as a standalone event. It is part of a move in which Japan's seafood majors, in step, pile up overseas processing and rearrange their supply networks through local investment. On the Vietnamese side too, the industry's center of gravity is shifting from exporting that merely sells volume toward processing and adding value. The day Vietnamese pangasius stops mass production: how processed goods open Japan's sourcing strategy The processing-focused current seen there and the Japanese side's need to diversify processing locations are in a relationship that meshes just right.

Where these two vectors overlap, a new form of Japan-Vietnam trade is born. Raw material gathered from various places, processing in Vietnam, consumption in Japan -- such a division of labor will become a matter of course behind the goods we handle from now on.

Plant overview

Summary: if the sourcing manager is to move right now

Kyokuyo's first plant in Vietnam is a turning point where the receptacle for Japan-facing processing widens from China to Vietnam. With crab and fillets at its axis, a major bringing its own quality control on-site opens the road for following buyers too. If you handle goods that rely on processing in China, start by taking stock of where in your own supply network can be replaced with Vietnam, and by inquiring with local processing manufacturers and trading companies about their current production items and supply capacity. Confirming the figures for operation timing and output by separating 'plan' and 'results,' and building sourcing decisions on high-confidence information, is the shortcut to making this redrawing of the map your ally.

References: Kyokuyo Co., Ltd. press release／Vietnam Fisheries Magazine／JETRO