The Indian seafood industry is grappling with uncertainties for the current year despite achieving a record $8 billion in exports during FY23. The principal concern revolves around tepid global demand for shrimp, falling prices due to excess stock, and a subsequent decline in local production. Shrimp constitutes a significant portion of India’s seafood exports, and industry leaders express a lack of optimism regarding a swift recovery in the coming months.
Jagdeesh Fofandi, the national president of the Seafood Exporters Association of India, cites a 15 to 20 percent drop in shrimp prices, with sluggish markets in the US and reduced Chinese buying. Payment issues with Chinese importers further compound the challenges. Despite last year’s peak in seafood exports, the industry faced difficulties throughout most of the year, with only a recent uptick in the last few months.
According to global shrimp expert Willem van der Pijl, large volumes of shrimp harvested in the final quarter of 2022 bolstered exports in the last quarter of FY23. However, prices started to decline from December 2022.
The global downturn in prices has impacted major shrimp producers worldwide. Rabobank’s research report forecasts a 14 percent increase in Ecuador’s shrimp output in 2023, while India, the second-largest shrimp producer, experienced a 4.7 percent decline in 2022 due to various factors.
Despite India’s record seafood export of 17,35,286 tonnes valued at Rs 63,969.14 crore ($8.09 billion) in 2022-23, the decline in shrimp quantities led to a 12 percent reduction in their share in the total seafood basket and a 7 percent drop in value.
Experts predict a challenging year for Indian shrimp production, expecting a decline from around 9 lakh tonnes to 6-7 lakh tonnes. Overstocked US markets and higher supply than demand may hinder price improvements until the beginning of 2024.
While the export of vannamei shrimp from India has dropped, there is a silver lining as the indigenous black tiger prawn gains increased demand, particularly from Japan. FY23 saw a 74 percent YoY increase in black tiger prawn exports to 31,213 tonnes, providing a positive trend for the current year despite challenges in vannamei shrimp cultivation.
Source: Money Control
