Ecuador
The global shrimp market is yet to recover from the ongoing decline following the pandemic. The accumulation of excess inventories is exacerbated by high production and transportation costs, exacerbated by the imposition of countervailing duties by the United States on the three largest exporting countries and a series of reports of harmful industry practices and misconduct (in the case of India).
Shrimp exporters from five countries – Ecuador, Vietnam, India, Indonesia and Bangladesh – expressed their views during the World Seafood Expo in Barcelona last week. Here are some highlights.
Uncertainty over U.S. tariffs has prompted shrimp producers to reduce production and exports, said José Antonio Camposano, executive director of the Camara Nacional de Acuacultura.
Although the tariffs were revised in March this year, reducing Ecuador’s national tariffs from 7.55% to 2.89%, as well as lowering tariffs for major exporters Santa Priscila and Sociedad Nacional de Galapagos (Songa), Camposano said, that before a final decision is made, there will still be uncertainty. continue to exist
US tariffs are not the only factor affecting production in Ecuador. The industry is also facing severe feed shortages as power cuts are forced to mitigate the effects of drought. “We could be facing a 10% feed shortage in the next few days,” Camposano said.
However, one manufacturer said it was developing investment plans and exploring efficiencies to increase production. The PCC group plans to increase production and export volumes by almost 40% over the next two years to 25 million pounds (11,340 tons), director Patricio Cobos Cordova said.
Vietnam
The head of Vietnam’s largest shrimp farming company expects supply and demand to become “more balanced” this year. Minh Phu Seafood CEO Le Van Quang says he expects prices to return to pre-COVID levels.
Le also spoke about Minh Fu’s plan to increase exports to 70,000 tons per year, up about 70% from last year. However, he said nothing about the US tariffs, saying only that there is “no clear indication yet” on how they will affect Vietnamese exporters.
However, in terms of tariffs, Ca Mau Seafood Processing and Service (CASES) plans to maintain shrimp production at around 18,000 tonnes. Huynh Nhat Thanh, the company’s head of sales, said the market is “very difficult” but consumption will rise “maybe at the end of this year or next year.”
Thong Thuan Seafood, which owns three shrimp processing plants and six farms, was hit harder than other companies when it came to tariffs. A company representative, who wished to remain anonymous, declined to comment on tariffs. However, he said Tong Tuan will be able to increase its typical production to 8,000-10,000 tons per year if market demand demands it.
India
Zubin Mehta, head of operations and sales at Mindhola Foods, said the tariffs will “hurt” India andput the country in “a sticky situation”. A bigger consideration is geopolitics: Conflicts in Ukraine and the Middle East are driving up freight rates and fuel costs, he said. However, this situation is not insurmountable.
“It’s going to be tense, but we’re not going to stop business,” he said. For Mindhola, the United States is the destination for about 15-20% of its exports. China is its largest market, accounting for 40-45% of sales. The company owns 600 hectares of shrimp farms in Gujarat, with an annual output of 4,000-5,000 tons, mainly for export.
Another company, Chitra Sea Foods, is looking for alternative markets. “We will reduce exports to the US and increase exports to Europe – we have already started,” managing director Swaroop Gandhi Chitra said. Chitra Sea Foods, a relatively new company based in Andhra Pradesh, is exporting shrimp at a rate of about 3,000 tonnes per year and hopes to increase production to at least 10,000 tonnes by the end of this year.
India’s shrimp industry remains reeling from a series of investigative reports into industry misconduct published last month. The accusations were vigorously defended by industry representatives. “It’s difficult to judge an industry based on one bad example,” said Mehta. “Indian companies are very professional and have state-of-the-art facilities in India.” Mumbai-based Forstar Frozen Foods is more optimistic about prices. Chairman S.G. Nair said a sharp decline in Indian production would bring supply more in line with demand and cause prices to recover by the end of this year or early next year.
“Indian farms are not doing 100% stocking, they are resisting stocking due to falling prices,” Nair said, estimating that India’s production could fall by 20-25% this year. For star has two processing plants in Mumbai that produce nearly 10,000 tons of shrimp annually and exports 80-85% to Japan, Europe and the Gulf countries. Avoided sanctions in U.S. countervailing tariff case despite being under investigation. This is a huge relief for the industry. After months of uncertainty, its exports to the US market are now enjoying a new lease of life.
“We are starting to get contracts from regular buyers in the U.S. again,” said Sandy Johan, export manager at PT Wahyu Pradana Binamulia, who said some U.S. customers had temporarily slowed down the pace of new deals. “Our sales to the U.S. have been down for about three months,” he said. “It’s hard for us to say anything (to our customers) because we don’t know ourselves.” PT Wahyu Pradana Binamulia All Exports Its Vannamei shrimp and black tiger shrimp. About 65% of the products are exported to the United States, 15-20% to Europe, and the remainder to Asia, mainly Japan.
The company’s processing plant in Makassar, Sulawesi’s largest city, produces about 2,500 tons per year. It processes shrimp from its own farm (approximately 200 hectares of land in South Sulawesi province) as well as shrimp supplied by other local farmers.
Bangladesh
The total value of Bangladesh’s shrimp exports last year was about $300 million to $350 million approximately 280 million to 327 million euros), said President and CEO of Dhaka-based trading company Borrak Seafood Trade International. Mohammed Shahjahani said. “A few years ago, our exports were around $500 million (approximately 466 million euros),” he said.
However, Bangladesh has been somewhat insulated from the long-term decline in world prices as black tiger shrimp (which accounts for the majority of its exports) command relatively high prices in the international market. Shahjahani said other Asian countries have turned their attention
to vannamei shrimp production in recent years. However, as production costs exceed prices, he said he has noticed more Indian producers switching to black tiger shrimp. This could lead to increased competition against Bangladesh.
“We are worried about India,” he said. Shahjahan said Bangladesh had reduced annual shipments to about 2,200 containers due to recent inventory build-up and lower global prices. “It’s chicken feed for the world market,” he said, “but we’re still doing pretty well.” He left a word about the quality of shrimp exported from Bangladesh. “Black Tiger will become the brand of Bangladesh!” he said. “Black tiger tastes different than vannamei shrimp; those who know will understand.”
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