Farmed shrimp production in Asia this year is likely to be lower than in 2018. In Latin America, increased production is expected in Ecuador. Shrimp imports were disappointing in the United States of America and the EU28 but strong demand from China kept the international shrimp trade stable in 2019.
Asian shrimp farmers remained conservative during the main aquaculture season between April and September of 2019, amid continued low market prices in the international trade.
In India, where shrimp aquaculture is mainly export-oriented, production forecast for 2019 suggested a 30–40 percent decrease in comparison with 2018. In the main aquaculture region, Andhra, the often unsuccessful price negotiations between farmers and processors/exporters, resulted in a much lower production this year.
In Odisha, cyclone and floods disrupted farmed shrimp production during the second half of the year and the region of Tamil Nadu was affected by the unusual and extreme hot weather this year.
Production trend in Gujarat and West Bengal remained moderate but insufficient to offset the falling supplies in the southern farming regions. Production in China and Southeast Asia (Indonesia, Viet Nam, Thailand and Malaysia) are likely to be lower than last year. Farmed shrimp production in Ecuador continued to grow, which became evident in its increased export trade during the review period.
The overall supply of sea-caught shrimp in Argentina was 16 percent below last year’s during the first six months of 2019. Subsequently, the Federal Fisheries Council of Argentina announced in September an early closure of the shrimp fishing season effective 15 October. Shrimp landings in the US Gulf of Mexico were also below last year’s during the review period.
During the second half of 2019, international shrimp trade escaped another market crash supported by strong imports by China. However, the three other large traditional markets, the United States of America, the EU28 and Japan posted negative import growths during this period.
Closely following the United States of America, China became the second largest shrimp importer in the world market during the first half of the year. Therefore, China is now the world’s number one market for shrimp. China produces about one million tonnes of farmed shrimp annually and about less than 20 percent of those are exported. Farmers in Asia, as well as in Latin America, benefited much from the strong import growth in China.
In East Asia, stable local demand and firm prices of head-on shrimp also absorbed more fresh
shrimp in the regional markets.
Overall exports of shrimp declined from most countries in Asia, due to lower import demand in the United States of America, EU28 and Japan, although exports increased to China in large percentages. Interestingly, Ecuador emerged as the top shrimp exporter, replacing India, during the first half of the year, which could be linked to its increasing production of farmed shrimp. For the first time in recent years, India reported a negative growth in shrimp exports.
In the top single market, the United States of America, imports fell behind last year’s during the first half of 2019. The trend was similar in most EU28 markets.
In Asia, China’s dominance in the import market was very strong. Imports in Viet Nam were nearly 60 percent below last year’s for the same period, following the strong direct imports by China and stringent control by the Chinese authority on unreported border trade with Viet Nam. In the Middle East, shrimp imports also increased in the Gulf Cooperation Council (GCC) markets, as shown by the shrimp exports from India, the main supplier.
United States of America
Consumer demand for shrimp in the United States of America has been good this year, especially during the summer season, as domestic wholesalers and distributors were able to maintain low price levels following the international price trend. The average import price of shrimp in the United States of America during the first six months of 2019 was 8.5 percent lower than a year ago.
However, the import growth was negative during the first half of the year, down to 301 500 tonnes, including 98 300 tonnes of shell-on shrimp, 138 200 tonnes of raw peeled shrimp, 39 000 tonnes of prepared shrimp and 21 700 tonnes of breaded shrimp. In 2018, this total amounted to 303 300 tonnes during the same period.
India remained the top exporter to the US market, supplying 115 700 tonnes (+1.4 percent) during the first half of the year compared with the corresponding period in 2018. Imports of breaded shrimp from China, the leading supplier, declined by 33 percent, after the imposition of a 25 percent tariff on Chinese products. However, the supply gaps were more than filled up by Thailand, Viet Nam, Indonesia and India.
Consumer demand for shrimp remained stable this year so far, despite competition with cheaper proteins, namely chicken and pork. Demand for ready to-eat products in particular improved in July and August during the school holiday season and also from late September in response to autumn demand, when Japanese people like to enjoy colours of autumn while eating outdoors.
Similar with the same period in 2018, this market imported 94 400 tonnes (-0.70 percent) of shrimp during the first half of the year, in which 30 000 tonnes (+3.4 percent) were prepared products.
Summer demand for shrimp in the EU28 market remained disappointing with lower imports in the top destinations of Spain, France, Italy, the Netherlands and Germany.
Total EU28 shrimp imports were down to 358 700 tonnes, of which 73 percent (263 000 tonnes) were supplied by non-EU28 countries, mainly Ecuador, India, Viet Nam, Greenland and Argentina. Imports of processed shrimp from sources outside the EU28, totalled 50 500 tonnes, slightly higher than the same period in 2018 (49 600 tonnes).
Shrimp imports also declined in the European markets outside the EU28, namely in the Russian Federation (-4 percent at 24 400 tonnes), in Switzerland (-12 percent at 4 000 tonnes) and in Norway (-8 percent at 10 600 tonnes) but increased in Ukraine by 30 percent to 4 300 tonnes.
Since 2018, China has emerged as the rising star in the global shrimp market. During the first half of this year, foreign shrimp supplies in China increased by 186 percent to 285 900 tonnes, compared with 100 000 tonnes in 2018 and 54 100 tonnes in 2017, for the corresponding periods. During the review period, Ecuador had a 41 percent share in these imports followed by India (21 percent) and Saudi Arabia (8 percent).
The increases in China’s direct imports reduced unreported trade with Viet Nam, which is reflected on Vietnamese imports of shrimp during the first six months of the year that declined by 59 percent to 90 500 tonnes. Viet Nam’s official exports to China increased by 140 percent to 10 900 tonnes during this period.
In Asia, shrimp imports also increased in the Republic of Korea, Taiwan Province of China, but declined in Hong Kong SAR, Malaysia and Singapore. In the Pacific, imports were lower in Australia(-10 percent at 13 300 tonnes) but increased in New Zealand (+15 percent at 3 000 tonnes).
A review on the Middle East markets also indicated higher imports of shrimp in the United Arab Emirates, Qatar, Kuwait and Oman, mostly supplied by Iran and Saudi Arabia.
Shrimp prices in the international trade remained stable in 2019 albeit with a weaker trend. In the United States of America, the average import price of shrimp in 2019 was 8.5 percent lower during the first half of 2019, compared with the same period in 2018. Wholesale prices remained stable at lower level that helped a stable good demand during the high consumption period in the summer months.
In view of the falling production in India, export prices have started to improve since August, albeit marginally. Prices of Argentinean shrimp remained softer than in 2018. However, the early closure of fishing on 15 October may help to improve prices during the last quarter of the year. As of September 2019, large sized shrimp from Argentina were being sold at below USD 10 per kg in Italian supermarkets.
This year’s shrimp farming season in Asia will be over by November in most producing countries. In the southern states of India (Andhra, Tamil Nadu), December is ideally the month for pond preparation. Stocking in the ponds will begin after the big religious festival “Makar Sankranti“ in mid- January 2020. In the Eastern region, the cooler season will be on from November until early January and pond stocking usually takes place from February. Hence not much improvement in raw material supplies is foreseen in India before March/April 2020.
Production in Thailand, Viet Nam and Myanmar will also be low during the cooler months from November to February. In Indonesia, current raw material availability is low due to short supplies of shrimp fry, causing delay in pond stocking for the next harvesting season. Besides, disease problems and cold weather conditions in the eastern aquaculture belt is also affecting production.
In the Japanese wholesale trade, current stocks are low for large sized black tiger and vannamei shrimp, whereas supply and demand for Argentine shrimp remains balanced. Demand for semiprocessed shrimp such as nobashi (PTO), tempura shrimp and other peeled shrimp is good, particularly from institutional users. This trend will continue until the December/January high consumption season.
Consumer demand for shrimp in the United States of America is likely to improve in the second half of the year. It is expected to be particularly good between November and the New Year, in concurrence with Thanksgiving, Christmas and New Year celebrations.
In Europe, trading has started to improve in anticipation of Christmas sales and lower supplies of the popular Argentinean shrimp due to early closure of the 2019 catch season. Some price strengthening is in the forecast following this low supply situation.
East Asian markets are also expected to be acquiring supplies for period of high consumption during the Chinese New Year, which falls in January/February 2020.